Skip to main content

Amazon.com Inc. announced Wednesday it will open a new warehouse centre in the Greater Toronto Area, the latest in what analysts say is a move to capture more of Canada’s nascent e-commerce market.

It’s the second Canadian expansion announced this month by the Seattle-based e-commerce company, which said two weeks ago that it would establish a warehousing centre in Ottawa. The two facilities are expected to open by the end of 2019 and will collectively employ 1,400 full-time workers.

The new Greater Toronto Area warehouse will be in Caledon, Ont., and is the fourth warehouse centre in the Toronto area. The warehouses will store, pack and ship small items to customers in the province, including goods such as books, electronics and toys.

Story continues below advertisement

Amazon said the warehouses will employ a large number of engineers, IT staff and HR workers beyond the warehousing staff. Federal, provincial and municipal politicians welcomed the expansion in a news release, saying it will bolster the local economy and benefit the community at large.

“We continue to be excited about our growth in Ontario and the opportunity to better serve our customers in the region,” Glenn Sommerville, regional operations director of Amazon Canada, said in a news release.

“We’re seeing an incredible workforce and community support in Greater Toronto. It makes us proud to add a new fulfillment center to better meet customer demand."

Ediz Ozelkan, an analyst at the market research company IBISWorld, said Amazon’s announcements come at a time when e-commerce is gaining steam in both the United States and Canada.

Canadian online sales make up an estimated 2.7 per cent of overall retail sales, compared with 9.4 per cent of retail sales south of the border, according to Mr. Ozelkan. But he said growth has still been considerable, as online sales accounted for just 1.3 per cent of sales in 2012. He also pointed out the gap in e-commerce sales between Canada and the United States has been closing, signalling more growth for Canadian e-commerce.

“The low base of Canadian e-commerce penetration could prove to be a lucrative starting point for Amazon’s continued expansion into Canada and can situate them as a major player in the nascent Canadian e-commerce landscape,” Mr. Ozelkan said in a note. “The e-commerce and online auctions industry in Canada is forecast to grow 253.8% between 2013 to 2018, and this has clearly caught the attention of Amazon executives.”

Myles Gooding, a partner with PricewaterhouseCoopers LLP, said the expansion makes sense because other Canadian retailers are also beginning to invest in e-commerce.

Story continues below advertisement

“Given the amount of retailers that have entered the Canadian market, it makes it a ripe area for them to come in and start to progress and move a little bit more forward on that front,” Mr. Gooding said.

He pointed out that Amazon announced a technology hub in Vancouver in April, which is another significant investment that will employ 3,000 people when it opens.

“It sends another signal that it’s more than just the warehousing, it’s also the talent equation and being able to build the ecosystem they’re building on a global scale,” Mr. Gooding said.

Amazon currently employs 6,000 people across various warehouse centres, corporate offices and development centres in Canada.

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter