Goyder warns of Amazon threat

AAP

Wesfarmers Ltd chief executive Richard Goyder says Australia's supermarket trade is not a duopoly controlled by Coles and Woolworths and online retailer Amazon is a far greater threat to local retailing.

Mr Goyder, whose Wesfarmers conglomerate owns Coles, has also made pointed references to the foreign ownership of competitors Aldi and Costco and questioned what tax contribution Amazon made in Australia.

"The narrative in Australia is that there is a duopoly in supermarkets - I read that all the time," Mr Goyder told an American Chamber of Commerce lunch in Sydney.

"Well I don't buy that at all."

Mr Goyder said Woolworths and Coles had a "strong position" in Australian supermarket retail but were not alone.

"Aldi now has 300 supermarkets across Australia - in fact it's not across Australia, it's across the eastern seaboard," he said.

"They've got German parents, they're all home-branded product and I'm not sure what significant community contributions they make - I'm sure they do something."

Mr Goyder said bulk retailer Costco, which has three warehouse stores across Australia and is expanding, was "owned by a massive US company with a market capitalisation significantly higher than Wesfarmers", while Metcash had 3,000 outlets.

However Mr Goyder said there was a "gorilla" on the doorstep in the form of Amazon.

Amazon, with a market cap of around $US156 billion ($A162.61 billion), sells many items sold by Wesfarmers businesses such as Kmart, Target, Bunnings and Officeworks.

"They are a good competitor," Mr Goyder said.

"I'm not sure how many people they're employing in Australia, I'm not sure how much community contribution they make to Australia and I'm certainly not sure how much taxation they're paying in Australia.

"If Wesfarmers is not strong, lean, dynamic, creative and innovative then Amazon will eat our lunch.

"Our aim is to make their time in Australia as hard as it possibly can by being as good a business as we can and earning the right for our customers to keep buying from us in Australia."