Amazon's UK division could supplant Japan as the firm's third biggest market this year despite a slow down in sales.
The UK business grew 12.5 per cent last year to $7.29 billion - half the rate of the previous two years. But its Japanese business stagnated with sales dropping 2 per cent to $7.64 billion.
That would mean the UK could overtake Japan requiring growth of just 4.8 per cent to match Japan's current size. That would make the UK Amazon's the biggest market after the US and Germany.
Amazon's sales in the UK have slowed amid suggestions that rivals are increasingly competitive. High street retailers have pushed their click and collect models to encourage shoppers back into stores which have provided convenient collection points.
Although some commentators sought to blame negative publicity over Amazon's tax affairs for the UK slowdown, a number of market research surveys have suggested shoppers are largely undeterred by the coverage.
Even if some shoppers had been put off, such a mood swing would be unlikely to explain the rapid slow down. However, Amazon has faced increasing competition from UK retailers both on and offline.
Amazon is trying to develop its clothing business to enable it to grow revenue in new markets where it is currently under represented. Clothing could also provide it with an opportunity to improve margins compared with low margin product areas such as electricals.
Sales in Germany, where Amazon has faced repeated strike action, continued to grow rapidly during 2013, increasing 20.6 per cent to $10.54 billion. Sales in the US rose 27.9 per cent to $44.51 billion. That helped total sales across Amazon's global business rise 21.9 per cent to $74.45 billion.
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