Why Amazon says it's good for entrepreneurs

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Why Amazon says it's good for entrepreneurs

By Mike Troy - 08/26/2019

As a government investigation looms into big tech competitive behaviors, Amazon said since the beginning of the year it has launched 150 tools and services to help third party sellers improve their performance. The timing is noteworthy because third party sellers collectively generate 58% of Amazons merchandise sales and have complained about the company’s business practices some contend give Amazon’s an unfair advantage.

Amazon’s view is that it is a facilitator of entrepreneurship, providing the investment, platform and resources to help make America. The company said tools like Sold by Amazon help sellers manage the pricing of their products in Amazon’s stores, while fulfillment tools like Target Inventory Levels allow sellers to better manage their Fulfillment by Amazon (FBA) inventory and, in turn, increase sales. New tools and services, along with infrastructure, programs, and people, are part of the more than $15 billion Amazon is on track to invest this year to empower independent small and medium-sized businesses selling in Amazon’s stores, according to company data.

Independent third-party sellers – primarily small and medium-sized businesses – acciounted for 58% of all physical gross merchandise sold in Amazon’s stores in 2018 and their sales far exceeded $2 billion on Prime Day in July this year and have created an estimated 1.6 million jobs worldwide, according to the company.

In addition to infrastructure investments, personnel, tools, and services, investments go towards programs such as Amazon StorefrontsAmazon HandmadeAmazon LaunchpadAmazon BusinessFulfillment by AmazonAmazon Global SellingMerch by Amazon, and Amazon Lending, which the company maintains are designed to help small businesses grow.

“Small and medium-sized businesses are the lifeblood of the economy, and we are committed to empowering them,” said Nicholas Denissen, Amazon Vice President of Small Business. “As part of our dedication to supporting independent retailers, we have thousands of employees around the globe who work hard on their behalf, developing tools and services to help them grow their sales in Amazon’s stores. Ultimately, our success depends on their success.”

New tools and services – from inventory trackers, pricing tools, sales reports, and product branding and marketing tools, to educational videos and webinars – help level the playing field for small and medium-sized businesses and lower barriers of entry for them to start selling in Amazon’s stores. Delivered through Seller Central, the business management command center, these tools and services give small and medium-sized businesses access to valuable sales and inventory insights as well as resources to help them manage and grow their business with Amazon. Among the types of recently introduced tools and services are:

  • Fulfillment and inventory tools – The Target Inventory Levels tool launched in the U.S., the U.K., Italy, Spain, France, and Germany to help selling partners obtain better insights into their FBA inventory. Achieving suggested inventory levels increases sales through more 1-Day delivery eligibility, and qualifies selling partners for lower storage fees.
  • Appstore and third-party tools – The Amazon Marketplace Appstore expanded globally into Europe, India, Japan, and Australia. The Amazon Marketplace Appstore helps selling partners identify trusted third-party applications that complement Amazon’s free tools and help them streamline their business operations. More than 200 apps are available.
  • Pricing management tools – Sold by Amazon, a free, opt-in service, helps selling partners save time and increase sales by automating prices so they can consistently and effortlessly offer customers great prices. The program is designed to give selling partners peace of mind that they will never receive less than the established price for a product, even if the product is sold to an Amazon customer for less.
  • Business reports and analytics tools – The Product Opportunities dashboard can help selling partners find new product opportunities that align with how they want to grow and scale their business. To do so, this tool generates customized reports based on business analytics and data that provide curated guidance for selling partners, like purchasing trends and requests for quantity discounts, which help inform their decisions for how to grow their selection. Selling partners using Amazon Business can use the new Marketplace Business Opportunities Portal reports to find more product listing opportunities for their business.
  • Seller University– An improved, redesigned Seller University portal helps selling partners find relevant educational content easier. In addition, Amazon launched a feature in Seller Central that gives selling partners personalized guidance about additional selling programs and features that they can experiment with to accelerate their growth. Each recommendation includes rich educational content (including Seller University videos) to help selling partners learn more about the programs.

“Based on our recent survey data, we know that greater adoption of digital technology, such as online retail capabilities and tools, could unlock small business job creation and growth to the tune of 360,000 jobs and $140 billion over the next three years with the greatest potential impact on small businesses in rural America with annual revenues under $100,000,” said Tim Day, Senior Vice President of the U.S. Chamber’s Technology Engagement Center (C_TEC). “To unlock this potential, the Chamber and Amazon share a goal of incentivizing entrepreneurship and enabling small business growth.”

Amazon also invests hundreds of millions of dollars each year in personnel and tools to fight fraud. As part of that investment, Project Zero launched this year in the U.S., the U.K., Italy, Spain, France, and Germany. It combines Amazon’s advanced technology, machine learning, and innovation with the sophisticated knowledge that brands have of their own intellectual property and how best to detect counterfeits of their products. Through three powerful tools – automated protections, self-service counterfeit removal, and product serialization – Project Zero's goal is to drive counterfeits to zero. 

Amazon this year also released a 2019 SMB Impact Report, highlighting how it empowers the millions of small and medium-sized businesses (SMBs), content creators, and developers in the U.S. and worldwide working with Amazon.