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Amazon Small Business Sales Surge 60% Amid Pandemic

By Jennifer Saibil – Updated Jul 21, 2020 at 12:32PM

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Third-party services outpaced first-party services.

Amazon.com (AMZN -2.02%) released its small business impact report on Tuesday that showed extraordinary growth for Amazon small business.

Outpacing Amazon

According to the 2020 small business impact report, there are now two million independent small and medium businesses that work with Amazon, and they sold 3.4 billion products over the past year, which averages out to 6,500 products per minute, and was up from 2.7 billion products last year.

Woman preparing  an order in a small business.

Image source: Getty Images.

"COVID-19 has changed the way we live and work and has created daunting challenges for small businesses around the world," said Jeff Wilke, CEO, Amazon Worldwide Consumer. "Third-party sellers have seen record sales in our stores and continue to outpace our first-party sales."

Supporting many livelihoods

The average small business took in $160,000, a 60% increase from $100,000 last year. More than 3,700 business rang up more than $1 million in sales for the first time, and the number of businesses that took in more than $1 million rose more  than 20%.

Amazon has more than 1,000 delivery partners employing 82,000 drivers, and U.S. line haul service providers, who move packages between air hubs and fulfillment centers, have 13,000 drivers, up from 3,700 in 2018.

Authors on Kindle Unlimited earned $319 million from the KDP (Kindle Direct Publishing) Select Global Fund, and more than 1,000 authors earned more than $100,000 in royalties.

Their success in Amazon's success

Over the past year, Amazon has given out $1 billion in AWS (Amazon Web Services) credits to accelerate small businesses. "Our success depends on their success," said Wilke.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool has a disclosure policy.

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