III. Industry Analysis
Amazon says that half of the American third-party sellers (approximately 2.5 million US sellers) took advantage of FBA. Amazon correlates usage of FBA with a sales increase of 34% among this cohort. Amazon also says that, on average, shipping with FBA costs 30% lower than other shipping carriers. This year, Amazon has aggressively grown its capacity of FBA, increasing square footage across its worldwide network of distribution centers by 50%. It has also hired 450,000 new employees to expand its FBA capacity.
Operating as a Fulfillment by Amazon (FBA) business is becoming an increasingly popular trend. Fashion brands operating as Amazon FBA businesses have been experiencing a gold rush. Jewelry, clothing, and shoes alone accounted for $33.4 million of FBA revenue.
Amazon FBA statistics reveal the following:
- There are 9.5 million Amazon sellers globally.
- 73% of Amazon sellers use FBA to sell.
- On average, new Amazon sellers make revenue of $26,000 to $810,000 annually.
- 57% of Amazon third-party sellers belong to the age group of 27 to 44 years.
- On average, an Amazon customer spends at least $700 every year, whereas Prime members spend about $1300 every year. This signifies that if a company utilizes Amazon FBA services, its visibility increases, especially to Prime buyers, and helps boost sales.