This Small Business Saturday, I'm Shopping at Amazon
Small Business Saturday is coming. It’s the day after Black Friday and, if it is as successful as last year, it will yield more than $16 billion in sales for small and local merchants across the country. Small Business Saturday is a great marketing promotion that American Express created a few years ago. As a small business owner and one who writes about and speaks to small businesses, I’m a big supporter.
Even so, I’m shopping at Amazon.
Amazon? Yes. The giant behemoth that’s slaying small businesses left and right? The big company that has put small booksellers, clothing stores, shoe shops and soon (probably) local grocery stores out of business? The giant that builds distribution centers the size of planets filled with products from floor to ceiling that are moved through to shipment by robots instead of people? The evil empire that hopes to deliver products by drone, controls your content and reads your mind using a little box in your living room voiced by that Alexa sexpot? That Amazon? Yes, that Amazon.
Amazon is a big business. But, like most big businesses, Amazon provides work, sales and jobs for thousands of small businesses and their employees.
According to reports from Fortune and Business Insider 83 percent of Amazon’s products are sold by third party retailers – these are mostly small companies. Its fulfillment services for small merchants delivered more than one billion products in 2015 while helping small businesses who have few resources with storage, delivery and shipping. The company helps their small merchants navigate the complexities of international trade in more than 185 countries.
Amazon has a customer reach of more than 50 million with its Prime members. The company provides its resellers with an enormous amount of demographic and sales data to help improve their sales. It also offers marketing and advertising advice for better positioning. In fact, in 2015 the number of sellers using Amazon’s advertising services doubled. The company wants its small merchants to succeed because when they do, it does.
And they do succeed. According to a survey that was done earlier this year by Web Retailer, about a third of the small merchants who sell on Amazon markup their products between 25 and 50 percent. More than a third use the platform to sell used items. Two-thirds rely on Amazon ads to promote their products. These small companies aren’t completely beholden to Amazon either -- 43 percent of them sell their products on other channels like eBay, Rakuten or their own websites.
Amazon is a big company that provides a livelihood for many small companies. But it’s not just Amazon. All big companies do this. Take a closer look at the largest employers in your hometown -- from Coke to GE to Microsoft to Caterpillar -- and you’ll start to see the microcosm of small organizations that support them. There are landscapers, maintenance services, parts suppliers, staffing firms, transportation companies, training organizations -- the list goes on.
The employees who work for these large companies go to their homes after work and order pizza. They go to local restaurants, hire electricians, plumbers and contractors. They get their hair cut, nails done and dry cleaning -- all from local merchants. On Small Business Saturday, these people will be spending their money at these local merchants, from their paychecks earned from their large company employers.
Small Business Saturday is a great idea. I am a small business. I love small businesses. Small businesses are the backbone of the country. I could go on and on, and it’s all true. But when you really think about it, what would small businesses be without the big corporations and their employees who use them?