As an Amazon seller, you might be curious about how other sellers are doing and what goals to set your sights on as an entrepreneur.
At a glance, it’s unclear exactly how much everyone else is making, or what realistic aims are for an Amazon seller. Scrolling through other sellers’ listings can only give you part of the story. Let’s take a look at how many sellers make over $1 million a year, and how much everyone else is making.
If you check out the growth of Amazon’s sellers over the last few years will give you a sense of the bigger picture. In 2018, 24,000 businesses passed $1 million in sales in Amazon’s marketplaces worldwide. This was an increase of 20% from the previous year. In 2017, 20,000 sellers hit $1 million in sales.
By 2021, 60,000 sellers had achieved over $1 million in sales in Amazon’s marketplaces worldwide, a staggering increase of more than double the number three years ago. Even at a glance, it’s notable that this growth is impressive.
One million in sales is not the ceiling, though, and quite a few Amazon sellers surpassed this mark in 2021. Let’s take a look at the breakdown of the elite sellers hitting even higher sales numbers.
- 9,500 Amazon sellers passed $5 million in sales.
- 3,300 Amazon sellers passed $10 million in sales.
- 180 Amazon sellers passed $50 million in sales.
- Finally, approximately 50 Amazon sellers passed $100 million in sales.
There are smaller goalposts other moderately-sized Amazon businesses have passed and it’s interesting to review these large groups as well. Let’s take a look at how these members of the Amazon community did in 2021.
- 350,000 Amazon sellers had over $100,000 in sales.
- 210,000 Amazon sellers had over $250,000 in sales.
- 125,000 Amazon sellers had over $500,000 in sales.
- 85,000 Amazon sellers had over $750,000 in sales.
What you might be noticing is that with each increase in the volume of sales, there are considerably fewer sellers who have achieved that number. What you are observing is a power-law distribution, which is in action when a large portion of sales in a marketplace tend to be created by a small number of its sellers.
The power-law distribution is illustrated well by the way sales are distributed among Amazon sellers. As you have seen, the bulk of the volume of sales in the Amazon marketplace is achieved by its top sellers.
Looking all the way back to 2016, we can observe that the number of sellers in each of the sales brackets in the Amazon marketplace has grown by between 20% and 40%.
Consider that in 2016, Amazon had approximately 100,000 sellers with at least $100,000 in sales. This then grew to 140,000 in 2017 and ballooned to 200,000 in 2018. Looking farther back to 2015, the number of sellers making at least $100,000 was just 70,000, meaning this number almost tripled over the course of just three years.
You might be wondering what prompts the ever-growing number of sellers who achieve these sales numbers. The increase is a direct result of Amazon’s overall marketplace growth which means that since the Amazon market has grown every year, opportunities are provided for new sellers to enter and for current sellers to grow. It is worth noting, however, that the robust sales figure groups are slower to grow than the lower sales groups.
Stepping back to view the system as a whole, you will see that third-party sales on Amazon are growing faster than first-party sales. This has compounded to make this marketplace the largest among online retailers in the U.S. Many have rightfully noticed this opportunity and decided to join the Amazon market as sellers.
In 2021 alone, over 470,000 new sellers joined Amazon to become part of the ever-growing marketplace and reach for the opportunities it can afford. This equates to roughly 1,824 new Amazon sellers signing up each day. These new Amazon sellers are joining close to 2.5 million sellers who are actively selling on Amazon, and just under 10 million who are part of the seller community overall.
The sense of opportunity on Amazon is boundless, and many sellers will enter the marketplace in the hopes of cultivating themselves as entrepreneurs on the platform. However, of these ambitious Amazon sellers, a minority will rise above the rest to become part of the segment of sellers who have truly built a business.
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