During the pandemic of COVID-19, the consumer shopping behaviour have changed drastically around the world. Amazon is one of the most successful corporations in the competitive consumer and retail industry, with an increasing number of consumers choosing to shop online.
Even at the height of the Coronavirus pandemic, the company managed to make large profits, which is a testimonial to their success. According to reports, Amazon's earnings increased by up to $5.2 billion in the first half of 2020, compared to $2.6 billion in 2019.
Amazon's success is largely due to the resources they set aside for the improvement of procedures and rules. The corporation was able to make a successful adjustment to its services by investing over $4 billion on "incremental COVID-19 related charges."
The claim that Amazon is hurting small businesses has surfaced in tandem with the eCommerce company's rise. Many people wonder if Amazon is destroying small businesses and the retail industry.
Amazon is destroying small and medium-sized businesses in the retail sector
Despite Amazon's success and the fact that it provided a safer way for shoppers to purchase necessary products during the pandemic, some groups are apprehensive of its domination. Some people believe that Amazon's success is hurting small and medium-sized retailers more than it is helping them. Is Amazon hurting small businesses, the concerned group asks in unison?
Amazon's alleged destruction of the retail business ecology is not a new problem. It should be remembered that even US Treasury Secretary Steven Mnuchin concluded that Amazon was having a negative impact on the retail business in 2019.
Mnuchin told CNBC, "I think if you look at Amazon, they've wrecked the retail industry across the United States, so there's no question they've curtailed competition."
The claim that Amazon is hurting small and medium retail businesses has considerable merit, especially in light of the mass closure of numerous brick and mortar locations. As a result, the allegation that Amazon is hurting small businesses is debunked.
Amazon's Impact on Small and Medium Businesses
Amazon is not deafeningly deafeningly deafeningly deafeningly deafeningly deafeningly dea Despite the claims and erroneous beliefs, Amazon is one of the most trusted eCommerce corporations in the United States and internationally.
In contrast to their adversaries' claims, Amazon is adamant that they are not eliminating small businesses, but rather assisting them in reaching new audiences and generating growth. During the recent Amazon Accelerate virtual conference, Jeff Wilke, Amazon's CEO Worldwide Consumer, underlined this even more.
Wilke emphasised the presence of a mutually advantageous relationship between Amazon and its sellers, the majority of whom are small to medium business owners, in the interview. As of now, it is believed that 1.7 million small and medium enterprises have Amazon storefronts.
Amazon remains unaffected by the expanding number of third-party sellers, such as small and medium-sized business owners.
According to Wilke, Amazon's purpose is to assist sellers succeed since more sellers means more options, which means cheaper item pricing. As a result, more customers will benefit.
Amazon’s Impact on Small Businesses In Numbers
There were more than 200,000 Amazon sellers who made more than 100,000 sales in 2019. This demonstrates that Amazon is not destroying small and medium-sized retail businesses, as they are among the most successful Amazon sellers.
Amazon has also aided in the expansion of job opportunities provided by these small enterprises in their communities. Job prospects have increased since Amazon opened its platform to small and medium businesses. In the United States alone, small and medium businesses have created 1.1 million jobs.
This isn't the first time small and medium-sized firms have had an impact on the eCommerce market. “20,000 small and medium-sized enterprises globally on Amazon exceeded $1 million in sales,” according to a report from 2017.
Amazon's impact on small enterprises isn't restricted to the United States or the United Kingdom. Amazon has aided tiny and aspiring entrepreneurs all around the world by creating side hustles and particular websites dedicated to small business purchases.
Alternatively, doing business through Amazon grants you access to a variety of advanced Amazon seller tools, such as the FBA calculator, repricers, and more. As a result, small business owners may make a seamless shift from traditional retail to eCommerce.
In exchange, Amazon's small business empowerment programme facilitated development and content design possibilities for more than 1.9 million small businesses and entrepreneurs around the world, resulting in the creation of more than 1.6 million employment.
For Business Success, Embracing Change
Amazon has undeniably altered the retail and consumer landscape. However, it cannot be denied that Amazon's introduction into the retail market has made it easier for sellers to contact a wider range of customers and suppliers. This is in stark opposition to the argument that Amazon is destroying the retail industry.
Amazon has, in some ways, levelled the playing field in terms of performance. Small enterprises and independent brands may now compete with large corporations and their well-known brands.
Small and medium enterprises should embrace the digital revolution and the ever-growing popularity of eCommerce as the digital marketing landscape continues to evolve and worldwide customers become more open to online shopping.
“It is not the strongest or the most intelligent who will survive,” legendary naturalist Charles Darwin said, “but those who can best manage change.”
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