New research from IDC* has found that selling in Amazon’s stores is supercharging growth for U.S. small and medium-sized businesses (SMBs). Small businesses that sell in Amazon’s stores are 2.5 times more likely (46% versus 18%) to have seen revenue growth of 25% or more in the past year than those not selling in our stores. Only 3% of those selling in Amazon’s stores saw flat or declining sales growth, compared to 20% of those not selling in our stores. As a whole, 94% of SMBs selling in Amazon’s stores said they'd seen some growth in the past year, compared to 66% of businesses who are not selling in our stores.
SMBs are also continuing to thrive through other online channels and physical channels. In fact, the majority of U.S. SMBs that sell products online typically sell their products through more than one online channel, and also sell through offline channels. 81% of Amazon sellers sell via other online channels, and generate, on average, 54% of their revenue from offline channels.
These are some of the findings from a new IDC survey of 350 U.S SMBs, commissioned by Amazon, to help us learn how to further improve the many tools and services we offer to support SMB sales and overall growth. Small businesses alone make up 99.9% of U.S. businesses and employ almost 60 million people, according to the Small Business Administration. Amazon’s independent selling partners, most of whom are SMBs, account for more than half of Amazon’s physical merchandise sales.
The survey also found that growth driven by selling in Amazon's store is helping these businesses create more jobs across the country. SMBs selling in Amazon’s stores are more than twice as likely to see 25% to more than 50% hiring growth compared to SMBs that are not (37% versus 16%) selling in Amazon's stores. Only 13% of SMBs that sell in Amazon’s stores reported relatively flat or declining headcount, compared to 46% of those not in our stores. As a whole, 85% of small businesses selling through Amazon’s stores said they'd added jobs in the past year, compared to 52% who are not selling through Amazon.
Shari Lava, Research Director, Small and Medium Business at IDC, shared, "Every small business surveyed is already selling to customers through online channels or planning to do so by the end of 2021, which is a huge step forward for SMBs as it empowers them to sell to customers across the country and around the world. It's clear that selling through online channels—either through their own website or a third party website—is boosting SMB growth and driving job creation across the country."
The report also found that 90% of the respondents said they "trust Amazon," and 90% also see Amazon as a "selling channel," "technology partner," or "business enabler."
SMBs are critically important to the U.S. economy and are an essential part of Amazon and the customer experience we obsess over every day. Their success is key to our success, and we invest heavily in infrastructure, tools, services, programs, and people to help our selling partners; in 2019 we spent $15 billion.
I'm thrilled to see sellers in the U.S. and around the world thrive and enjoy record sales in Amazon stores. Altogether, they are selling an average of 4,000 products a minute and they have created more than 800,000 jobs. Particularly exciting, a little more than one year after launch, Amazon Storefronts–our store to exclusively shop American companies–grew to more than 2.5 million items from nearly 30,000 small and medium-sized businesses from all 50 states, with more than 250 million items sold to more than 70 million customers.
U.S.-based sellers represent a majority of third-party businesses and sales in our U.S. store, and we enable these SMBs to reach customers in more than 180 countries around the world, with rapid sales growth in Europe, Canada, Mexico, Japan, and beyond. In 2018, companies based in the U.S. sold more than $2 billion in our international stores.
All in all, there are great opportunities ahead for SMBs. Thank you to the SMBs selling in our stores and the customers who shop their products.
*Source: International Data Corporation InfoBrief, commissioned by Amazon, SMB Success in the Multichannel Era, January 2020. Methodology: Survey of small and medium business owners, executives and managers across multiple industries, currently selling or planning to sell online, fielded August – September 2019.