The Amazon marketplace is changing rapidly. Competition among sellers has decreased by 21% over the past four years, creating new opportunities for those who know how to navigate the platform effectively.
Let’s take a look at the numbers. In 2021, there were over 2.4 million active sellers. Today, that number has dropped below 1.9 million. Yet, despite this decline, nearly a million new sellers join every year.
On the other hand, traffic per seller has increased by 30%. Each seller now receives 2,837 monthly visits compared to 2,162 in 2021, thus generating greater visibility for those who remain on the platform.
Some figures help clarify how business on Amazon is evolving:
- Active sellers: reduced from 2.4 million to 1.9 million
- Traffic per seller: increased by 30% in four years
- Amazon revenue: grew by 36% (from $470 to $638 billion)
- Third-party sellers’ share: from 56% to 62% of units sold
- Million-dollar sellers: over 55,000 have surpassed $1 million
- Average income: $290,000 per U.S. seller in 2024
That’s not all. Apparently, longevity also pays off: over 60% of the top 10,000 sellers have been registered since before 2019, showing that experience and adaptability are crucial for success.
Geographically speaking, smaller markets offer better traffic-to-seller ratios in a moderately competitive environment. However, the total volume limits substantial earning opportunities, making the United States the primary market for high revenue.
The new challenges Amazon sellers must face
Naturally, the many opportunities that sellers can seize on Amazon should not overshadow the major challenges they will have to manage. Let’s identify a few of the main ones.
>>> Also read our article FBA or FBM, how to calculate the optimal stock quantity. <<<
FBA inventory management
Stock calculation has become increasingly important for sustainable growth on Amazon. Sellers must maintain stock between 30 and 60 days: too much inventory incurs storage costs, too little triggers penalties.
Amazon counts shipments as planned inventory, complicating management for those restocking from local warehouses. Productivity determines the replenishment limits based on three-month windows.
Impact of robotics
Amazon has deployed over 750,000 robots in fulfillment centers to push automation—technology that promises efficiency but also creates new problems. Sellers often complain about missing inventory and delayed refunds.
Moreover, it’s known that robots make decisions on A-to-Z claims, raising concerns among sellers who prefer human intervention. Artificial intelligence often still fails to resolve complex issues.
>>> You can also read our Practical Guide to the Amazon Daily Sales Report. <<<
Financial pressures and international competition
Amazon fees account for a significant portion for many sellers, leaving increasingly narrow margins. Long-term storage costs further hurt margins, making strategic planning essential to achieving better profitability.
On the topic of pressure, note that Chinese sellers now represent over 50% of top sellers, and direct-to-consumer production intensifies price pressure, making it hard for Western sellers to compete.
Tariff uncertainties further complicate the landscape. Import costs can change quickly, making long-term planning more difficult.
>>> Also read our article How to sell on Amazon USA: The Complete Guide for European sellers. <<<
Strategies for success
In this context, it becomes increasingly important to focus on identifying the most effective strategies for success.
One of these is operational optimization. Maintaining inventory within the optimal range is essential, and being able to stay within the 30–60 day window can minimize costs and penalties.
It should also be noted that many sellers need specialized support to navigate these complexities. As a result, experienced Amazon agencies are becoming increasingly valuable. Finally, operational precision—non-negotiable on Amazon. Mistakes come at a high cost in terms of fees and missed opportunities!
All of this confirms that the Amazon marketplace continues to mature rapidly. And sellers who are able to adapt are also the ones who can thrive more easily, unlike those who are forced to leave the platform. It is very likely that this natural selection process will continue for a long time.
It should also be noted that entry barriers are constantly rising. Capital and skills are becoming prerequisites for success, meaning that new entrants must be prepared for significant investments to carve out a space among the competition.
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