Small firms worry about 'Amazon effect'

More than two in five smaller businesses are worried about a loss of customers and revenue with the entrance of multinationals like Amazon into the Australian market.

While many Australians already use the online US retailing giant, Amazon will set up shop in Australia by late 2018 with the promise of even faster shipments of products from clothing to electronics.

A survey by MYOB found 43 per cent of owners of small and medium-sized businesses fear additional overseas operators will mean a loss of customers or revenue.

Over half (57 per cent) say it will force them to innovate their businesses.

MYOB boss Tim Reed said it is heartening to see businesses are thinking proactively about this.

"However, the findings show us that there is still a ways to go to settle concerns around customer and revenue impact, especially given the wider global environment they're now playing in," he said.