Amazon plans to enter Southeast Asia with Singapore launch in Q1 2017

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Amazon is ready to enlarge its presence in Asia. Months after it pumped $3 billion into its India business and a week after it quietly introduced its Prime service in China, plans for its entry into Southeast Asia next year have surfaced.

The U.S. retail giant doesn’t currently offer local services in Southeast Asia, but it is working to enter the region via a launch in Singapore. Amazon is covertly acquiring assets, including refrigerated trucks, and making new hires as part of an initiative led by head of ASEAN Steven Scrive, two sources close to the company told TechCrunch. The current plan is to launch selected services in Singapore within the first quarter of 2017, one source added.

Amazon declined to respond to a request for comment.

The U.S. company is likely to initially offer its Prime delivery service alongside its AmazonFresh grocery service, in Singapore, we understand. Earlier this year, Amazon made an offer to acquire Redmart, a grocery delivery startup in Singapore backed by Facebook co-founder Eduardo Saverin, but the bid was deemed too low and rejected. We reported last week that Redmart is in talks to be acquired by Lazada, the e-commerce firm that Alibaba invested $1 billion in earlier this year. Amazon declined to reenter acquisition talks, despite contact from Redmart, instead deciding to build out its own operations.

Southeast Asia is home to over 600 million consumers and, while online is estimated to account for less than five percent of all commerce today, its digital economy is tipped to grow significantly over the next decade. Already, Alibaba has stepped into the region via investments in Lazada, delivery firm SingPost, and payments company Ascend Money. Amazon competes fiercely with Alibaba-backed Paytm, Flipkart and Snapdeal in India, and it has decided that now is the time to join its rival in Southeast Asia.

There’s been speculative talk that Amazon is harboring plans to Indonesia, the world’s fourth most populous country and Southeast Asia’s largest economy, but sources told us that Amazon is fully focused on expanding into Singapore at this point.

That makes a lot of sense because Singapore is not only smaller and easier to service from an operational perspective, but the level of customer spend and consumer culture is more closely aligned with Western markets where Amazon thrives. Other emerging markets will take great levels of adapting, leaving Singapore as an obvious first landing point and general hub/HQ for the region.

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