I recently sat down with David to discuss how he reached a whopping $12,000 in profit in his third month selling on Amazon. David cited consistency and confidence as key drivers of profits.
But despite his quick success, David was hesitant about starting an Amazon business in 2024. Here’s what he had to say in retrospect:
“When I first started the process, I thought I was late. Like dang, why didn’t I do this 10 years ago? Fifteen years ago?”
But he’s not alone. I thought I was late when I started on Amazon, over 7 years ago!
Here’s my honest opinion; Amazon’s been around forever, and if you’re like me, you’ve watched the company grow from a tiny online book store, to the colossal retail giant it is today. I’ve witnessed Jeff Bezos’ transformation from a biscuit-addicted mega-nerd to the roided-out Mr. Clean-looking tycoon he is today.
Here’s the point; Amazon’s influence is spread so wide that people just assume it’s impossible to earn profits from an Amazon-related business in 2024. I call this having Amazon syndrome.
“It’s too oversaturated!”
“There’s no good products left!”
“But What About Temu?”
However, when you examine trends and data, it’s clear there’s still plenty of opportunity for independent sellers to earn profits and cash in on untapped – and upward-trending – markets.
But even more important, Amazon’s success is because of third-party sellers like you and I. Remember, 61% of all Amazon sales in 2023 came from independent sellers.
So here’s why it’s not too late to start an Amazon business in 2024.
| FAQ: What are Independent and Third-Party Amazon Sellers? These two terms mean the same thing. Effectively, they’re any seller who’s not Amazon. Individual sellers (like me) and larger businesses alike can use Amazon’s fulfillment to sell products. These are called independent, or 3rd party sellers. |
What The Data Says:
I’m a numbers guy, so I was shocked to read in a recent report from the U.S. Census Bureau that e-commerce sales accounted for just 15% of total retail sales in 2023, up slightly from 14.7% in 2022.
I’m always surprised to hear this number isn’t closer to 50%…again, Amazon syndrome.
Digging deeper, Amazon accounted for 37.6% (well over 1/3) of all e-commerce sales in 2023, with its next biggest competitor being Wal-Mart, aka America’s bizarre.
At the same time, overall retail sales in the U.S. (including both e-commerce and physical purchases, as well as food purchases) are on the rise, despite recent inflation and supply chain woes. Simultaneously, more retail stores are predicted to shut down across the country over the next five years.
My conclusions?
- More and more people are shopping online. And as the trend continues, Amazon will dominate e-commerce, creating ample opportunities for entrepreneurs to capitalize on.
- While I don’t think e-commerce sales will ever get close to 100% of all retail sales, it’s clear the portion of e-commerce sales will only increase in the coming years.
But What About Temu?
Growing up, our local dollar store sold fun bags for $1.
The fun bag was a brown sandwich bag, full of mystery toys and trinkets, always stapled tightly together to avoid peeking inside. You never knew what you’d get, but rest assured, it’d be full of cheap-ass junk; (plastic spider rings, temporary henna tattoos, sticky-slap hands).
The fun bag is lot like ordering from Temu (or any of its equivalents). You never quite know what you’re going to get, but most likely something of dubious craftsmanship.
I’ve heard countless stories about atrocious quality products showing up at friends’ doorsteps. A colleague recently ordered a dress shirt only to receive what he called, “a mystery garment that when worn, felt like a mixture between popped balloon and a dog licking my back.”
People have always bought cheap goods from overseas, Walmart is literally a landslide of cheap Asian imports.
And just as it’s always been, a product’s branding, marketing, and perceived value are how you earn profits from sourcing cheaply.
So while I’m keeping an eye on my products’ performances, I think Temu is just a trend. Plus, with so much talk about TikTok being banned, I wouldn’t be surprised if Temu is on the chopping block.
My Conclusion?
Even if it sticks around, product quality is ultimately too poor, and shipping too slow to be a real Amazon contender. Where Temu falls short, Amazon excels in.
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