Small businesses have more choices than ever when it comes to where they sell their products. So why do so many independent sellers keep choosing the Amazon store?
While there are lots of reasons, most sellers tell us they choose to sell in the Amazon store because it’s a great value. Sellers get to sell in a store that many customers trust, they get access to powerful tools, services, and programs to drive their business growth, and sellers can do all of this at a cost that is typically lower than their alternatives. As a result, sellers have a compelling opportunity to grow their business by partnering with Amazon, and Amazon continues to foster that relationship by inventing and innovating on behalf of our selling partners.
In 2022, we were thrilled to see that independent sellers had another record-breaking year. More than 60% of sales in the Amazon store come from independent sellers, and in 2022, U.S.-based sellers sold more than 4.1 billion items to customers worldwide, averaging more than $230,000 in sales in the Amazon store.
"The nice thing about Amazon is that everyone has an equal opportunity; any small idea you can make happen. You don’t have to be this big company to launch a product. It doesn’t matter how small you are, we are able to compete with some of the biggest players."
The value that Amazon provides to support this level of seller success comes down to three things: 1) Our commitment to customer trust. 2) The breadth of tools and services we provide all professional sellers. 3) The set of opportunities we offer through optional programs like Fulfillment by Amazon (FBA), Amazon Ads, and many more. These areas of focus are why independent sellers are finding great value selling in our store, and why they continue to select Amazon as a channel for their businesses.
The Amazon brand helps independent sellers attract and reach more customers
"If we would have had to grow our brand from scratch to where it is today without Amazon, it would have been possible, but we would have had to raise money or spend much more money to acquire customers and get brand awareness. The ease and access to put our product in front of millions of customers worldwide, Amazon really gave us that exposure at a low cost to a huge amount of customers."
Amazon’s reputation with customers is a key part of what leads independent sellers to choose our store. We help deliver a vast selection of products to customers around the world—on time, in the condition expected, and at competitive prices. This is the promise we make daily, and that customers rely upon. In addition to great selection, prices, and convenience, Amazon continues to invest in building our brand, and we have used everything from influencer reels to Super Bowl commercials to do so. We also invest heavily in digital advertising so that even when a customer uses a third-party search engine, or scrolls their favorite social media feed, there’s a good chance they’ll see ads purchased by Amazon that link directly to products sold by independent sellers. Behind the scenes, Amazon also makes big investments in preventing counterfeiting, fraud, and other forms of abuse, to ensure our store continues to be a safe and trustworthy place for customers to shop and sellers to build a thriving business. In 2022, we invested more than $1.2 billion and employed over 15,000 people—including machine-learning scientists, software developers, and investigators—to help protect our store.
These kinds of investments are a big reason Amazon continues to be one of the most trusted brands in the world, and they helped us earn the rank of most trusted brand by U.S. consumers in 2022. When sellers choose to sell in the Amazon store, they get to benefit from our decades of investment in providing an amazing customer experience, enabling sellers to attract and reach even more customers. It also means that independent sellers become part of that experience as soon as they create their first listing in the Amazon store. It’s often a seller’s brand that is discovered by shoppers who couldn’t find the perfect gift anywhere else. It’s frequently a seller’s product that provides innovative new features and reliable quality that delight a customer. And it’s often a seller’s product arriving on-time at a customer’s doorstep. So, while sellers get the opportunity to tap into the Amazon brand and trusted customer relationships, we also work together to make sure that we continue to live up to that reputation with customers—the kind of trusted reputation that builds loyalty with customers and provides great value for sellers in the Amazon store.
Amazon provides every professional seller with powerful tools and services for growing a thriving business
"The tools and resources that Amazon provides to help run my business are really empowering. There is no question in my mind that without Amazon I would have never gotten this business off the ground."
It takes a lot to be a small business owner. To get products into the hands of customers, independent sellers need drive discovery of their items, price their items competitively, fulfill orders promptly, handle customer support, and process customer returns. Independent sellers usually need to complete a range of other tasks, including doing customer research, refining their product design, building their brand, monitoring purchasing trends, running promotions and deals, preventing fraud and abuse, ensuring product compliance, protecting their intellectual property, and much more. Amazon continues to invent on behalf of independent sellers to provide powerful tools and services that support them at every stage of their journey.
In addition to the listing, pricing, and order management tools that every seller needs, we also provide every professional seller with many other services, including multiple options for promoting products and driving increased sales, especially around popular events like Prime Day. Sellers can use self-service tools to expand their sales to new countries, or they can use programs like Amazon Business and Handmade, which are designed for different types of customers and products. We offer sellers access to rich reporting and analytics, including broad customer search behavior from across the Amazon store and very granular purchasing insights and trends. Independent sellers can also use hundreds of apps that provide additional capabilities for managing their business, and they have access to hundreds of thousands of hours of free educational content, while aspiring entrepreneurs can find free content to launch and grow their business with Amazon Small Business Academy. Sellers that are brand owners can also register their brand for free with Amazon to unlock powerful brand protection tools and a suite of additional selling tools for brands—allowing them to enhance product detail pages, create brand marketing campaigns, and analyze customer engagement to refine their brand’s products.
Amazon also has tens of thousands of employees who are dedicated to helping sellers succeed. They invent on sellers’ behalf to create new growth opportunities and eliminate issues that slow down sellers, and are a trusted partner that can guide sellers as they build thriving businesses. These benefits are included for every seller in the Amazon store, and Amazon continues to add more capabilities to help ensure that sellers have everything they need to grow and succeed.
Sellers can choose to leverage a set of optional, paid services that provide tremendous value
Amazon strives to offer entrepreneurs and small businesses powerful selling capabilities, and, by giving them access to Amazon’s technological innovation and broad reach, we provide sellers of all sizes with a number of optional services at a great value—services that are typically only accessible by larger businesses. This includes services for obtaining loans at competitive rates, advertising products efficiently, fulfilling products fast and at a low cost, getting expert advice from an account manager, and many more. These optional, paid services aren’t required for succeeding in the Amazon store—some independent sellers run thriving businesses without them—but many sellers choose to use them because they offer impactful opportunities to drive their business growth at lower cost.
"There's no way we could store, pick, pack, and deliver these shoes without Amazon. Our customer, they have access to five, 10, 20 times the amount of inventory because of the capability. We don't need to be the experts in warehousing and third-party logistics. We can do what we're good at, which is helping as many people as possible through running, and that's what I like to do."
Amazon launched Fulfillment by Amazon (FBA) in 2006 to ensure Amazon customers could get fast, reliable delivery on a larger selection of products. Customers had a growing demand for fast shipping, and Amazon wanted to meet that demand. With FBA, sellers send their products to Amazon, and we store, pick, pack, and ship these products to more than 100 countries and regions, as well as handle their customer service and returns. We have invested billions of dollars into a network of 100+ fulfillment centers in the U.S. alone. As a result, customers now have access to tens of millions of products with one- and two-day shipping, and independent sellers now have access to the premium shipping service that comes with FBA and on average, costs 70% less per unit than other U.S. major carriers’ premium two-day shipping options, making it one of the best ways independent sellers can save time and money.
"We've been able to leverage several tools through working with Amazon. We have a particularly strong partnership with our [Amazon Ads] account executive, and we've been able to partner strategically with her to gain insights on our Amazon consumer, as well as using things like Amazon [Posts] and the [Manage Your Customer Engagement] emails to connect with our Amazon customer and tell them a little bit more about Fellow."
For many independent sellers, impactful and cost-effective advertising is critical to running a product-based business. Amazon Ads offers solutions that help small and medium-sized businesses easily create, manage, measure, and optimize cost-per-click campaigns using self-service and highly automated campaign tools. These advertising solutions help small businesses launch ads in the Amazon store, so they can reach customers who are already shopping and with high purchase intent. With our cost-per-click ads products, sellers set their own bids and budgets, which means they never have to overspend on unproven advertising. Amazon also provides rich reporting and analytics, enabling sellers to easily analyze and optimize their advertising campaigns from what a seller chooses to spend all the way to how that drives their sales. According to a 2022 benchmarking report, sellers and other advertisers using our Sponsored Products ads spent 13-79% less per click compared to alternatives. In combination, the impact and cost-effectiveness of Amazon Ads campaigns and tools help drive a greater return on sellers’ advertising investment.
Small businesses can use Amazon Lending to secure highly competitive rates and financing options—in 2022, Amazon and our third-party lending partners lent $2.1 billion to independent sellers, an increase of 50% from the previous year. Over 33,000 brands use Transparency to apply unique codes to every product unit they manufacture. These codes can be scanned by retailers and customers to ensure product authenticity, determine important product information such as expirations and manufacturing location, and to get access to value-added features such as coupons. Veeqo allows sellers to manage their inventory, purchase shipping from multiple major carriers, and fulfill orders for products they have sold across all the places they sell. Veeqo offers immediate discounted rates to sellers, with savings of up to 78% on UPS Ground shipping labels. In addition to FBA, Amazon Ads, Amazon Lending, Transparency, and Veeqo, there are many more optional programs that Amazon makes available to small businesses—providing them with powerful capabilities and a great value.
More than 60% of the sales in Amazon’s store come from independent sellers, most of which are small and medium-sized businesses.
“Amazon is the foundation of what we’ve done. We started the brand in Amazon’s store. I chose very early on to pour myself into this channel because I thought it was the best place to build a sustainable business.”
We have been investing in the success of independent sellers for the past 23 years, and together, we are writing the story of the most successful relationship in the history of the retail industry. However, as we often say, it is still Day 1, and we continue to challenge ourselves to invent and support even greater success for small businesses in the future.
