Amazon is positioning themselves as a e-commerce infrastructure company, not a retailer. Their message to big brands is that they are not selling products to Amazon for resale, but instead using Amazon as a platform to reach a massive audience, and using their infrastructure to facilitate all e-commerce tasks. In this view, Amazon is not a middleman, but instead an enabler.
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Since Walmart marketplace has been receiving a lot of attention from marketplace sellers, we decided to investigate how big the opportunity of selling on Walmart really is. We found one way to look at it - by comparing seller feedback. By comparing all feedback received by all Amazon sellers, to all feedback received by all Walmart sellers, we could get a relative number.
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Last year Amazon collected $8.9 billion in shipping revenue, but spent $16.2 billion on shipping costs. Thus the net shipping cost is $7.2 billion. Because of the growth in Amazon Prime membership and the current $25 minimum to get free shipping, fewer people are paying for shipping. This has resulted in shipping costs growing faster than shipping revenue. As shown in the chart below, during the busy Christmas periods the difference is very large.
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Today Walmart passed a big milestone - 10,000 sellers on the marketplace. Even though Walmart marketplace was launched in 2009, it took a while before it started to gain traction. The first time we covered Walmart was in May 2016, when the Walmart marketplace just passed 500 sellers.
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We've been covering scam sellers issue for a while now, but lately we noticed a new trend. Instead of opening new accounts, which Amazon has been more proactive about shutting down, they are using old dormant seller accounts.
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Retailers like Amazon create cash by buying goods from vendors and selling them to consumers. We recently made Amazon Cash Conversion Cycle public, it was -37.40 last year. What this number means is that after Amazon collected payments from customers it only paid their supplies 37 days later.
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We looked at the top eBay US stores to see where they are located. We found that roughly 30% of the top 10,000 sellers are based in China.
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In the last 12 months, we detected close to 700,000 new sellers join Amazon.com. Many more joined other Amazon marketplaces, but in this analysis we chose to focus on the US market alone.
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New York State Governor Andrew Cuomo is proposing several tax-related changes in the 2017-2018 Executive Budget Bill, one of which is the marketplace sales tax. The bill effectively shifts the sales tax collection burden from the seller to the marketplace.
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Amazon in Europe is a unique market - while there are 5 separate marketplaces (UK, Germany, France, Spain and Italy), the countries are close enough to each other that they can be treated like a single marketplace. So we decided to analyze European marketplaces and see how much of cross border selling is there.
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