One of the most commonly asked questions about the Amazon marketplace, apart from how many sellers are selling on the platform, is how many sellers have sales greater than $100 million, or more than $1 million.
However this is hard to calculate since Amazon not only doesn’t disclose the marketplace GMV (the only reported figure is their own sales, 1P), but there are few public metrics about the sellers themselves. The only number related to their selling performance is the number of feedback reviews they have received, but even that is not consistent across all sellers.
Either way, we finally wanted to tackle this question.
We started with a few assumptions. In Amazon Marketplace GMV to Double in Three Years we wrote that the worldwide GMV for sellers is estimated to have been $103 billion in 2016. This is to be shared by all sellers. Second, Amazon has said that there are 100,000 sellers with over $100,000 in sales, which acts as a validation check for our calculation. Finally, we expect the results to turn out looking like a hockey stick distribution where very few sellers are at the top.
So we took all sellers from all Amazon marketplaces and calculated how many feedback reviews they each received in a year. Then we added all of them up, and used the sum to divide the sellers GMV figure of $103 billion from above, arriving at a per-feedback value. We then finally multiplied each seller’s feedback count by the per-feedback value to arrive at their estimated sales.
9 sellers with sales over $100 million
20 sellers with sales over $75 million
40 sellers with sales over $50 million
135 sellers with sales over $25 million
546 sellers with sales over $10 million
859 sellers with sales over $7.5 million
1,606 sellers with sales over $5 million
4,376 sellers with sales over $2.5 million
13,771 sellers with sales over $1 million
19,058 sellers with sales over $750,000
29,102 sellers with sales over $500,000
55,386 sellers with sales over $250,000
111,162 sellers with sales over $100,000
The way to read this data is that there are roughly 100,000 sellers with sales over $100,000, roughly 10,000 sellers with sales over $1 million, roughly 500 sellers with sales over $10 million, and roughly 10 sellers with sales over $100 million. The exact figures are very rough estimates.
While a very rudimentary method, it provides a similar insight into the market like our other research articles. Due to the limitations of the data we cannot make exact calculations, but we can make estimates which are correct in the orders of magnitude. The number of sellers selling over $100 million is undoubtedly not 9, but it is not 90 either - it is somewhere in the range of 10-25. Yet the number of sellers with sales over $100,000 at 111,162 is only off from the official figure of 100,000 by 10 percent.
The findings of this research highlight the hockey stick distribution we were looking for - it gets increasingly harder to scale a business to reach a new level of sales. Very few companies have managed to take it beyond the $100 million line and sustain it for years. Many of those top sellers are resellers, which is increasingly hard as competition increases.
Some of the sellers have managed to grow beyond $100 million, but we don’t think any have reached $1 billion yet. Few of the top sellers we talked to even raised a question of does Amazon want to see sellers grow so big. We think the market is going towards having many small sellers instead a few big ones.