As the world’s largest online retailer and with a wide product range, Amazon enjoys great popularity from it’s customers. This popularity is reflected in Amazon’s product sales worth over $108.35 billion in 2017 and year-on-year growth of 19%. However, few people know that over 50% of Amazon’s total sales is done by third-party sellers on their respective marketplaces. The importance of marketplace sellers becomes clear when taking into consideration that over 140,000 sellers had a revenue of $100,000/year or more in 2017.
Amazon Canada, which opened its gates to third-party sellers in November 2003, is tightly connected with Amazon US as many Canadian customers make purchases on Amazon U.S. In return, a significant amount of third-party sellers from the U.S offer their products on Amazon Canada. There are over 100,000 sellers on Amazon’s marketplace in Canada offering a wide range of products. In 2016, marketplace sellers in Canada achieved a milestone of one billion in sales, which speaks for the economic power of Amazon Canada.
Amazon Canada marketplace research
Amazon Canada welcomes on average over 170 new sellers every day who will offer their products on the marketplace. This steady increase in competition makes it difficult to find low-competition products. Algopix’s Amazon Canada marketplace research enables you to quickly determine how attractive a product is to your business thanks to its competition level indicator. With additional insights into your competition which Algopix’s Amazon Canada product research tool provides, you then can form a strategy about how to position your business on the market, how to price your products competitively, and ultimately it gives you the chance to compete for the Buy Box Offering.
Strict performance targets like a late shipping rate below 4% makes using Fulfillment by Amazon (FBA) inevitable
With over 50% of Amazon Canada’s top sellers using FBA, it has become an important service in order to keep up with competitors. When using FBA, Amazon takes care of all your warehouse operations, including customer service and returns but charges storage and fulfillment fees in return. Since these FBA fees vary, it can be challenging to calculate profit margins and estimate the profitability of a product. Algopix’s Amazon Canada product research tool takes this challenge from you and gives you a detailed explanation of all the costs related to selling a product, including taxes, marketplace fees, shipping fees, or FBA fees.
Amazon Canada seller tool
In the past, Chinese manufacturers used to sell their products to retailers who then sold those products for a profit on the market. Innovations such as the introduction of FBA led these manufacturers to cut out the middlemen and sell directly to their consumers in Canada. This allows them on the one hand, to raise their profit compared to the traditional process, and on the other hand, to underbid their competitors, offering the products for a much lower prices. While being great for consumers, it poses a huge threat to domestic online sellers on Amazon Canada. The new competition means not only a decrease in market share and sales volume, but also lower profit margins because of the price competition. Algopix’s sophisticated Amazon Canada seller tool helps you identify new products with promising profit margins and low competition. It does so by first calculating the total costs associated with selling the product on a given market and then, takes the provided purchasing price into account, thereby estimating the profit. Additional information from Algopix Sales Estimator about the sales volume and gross merchandise volume for the last month gives you an estimate about market size and demand. With this information at your fingertips, making an educated product sourcing decision becomes fareasier and allows you to only add products with an attractive profit margin to your sales mix.
An increasing amount of non-Canada based sellers are coming to Amazon Canada
In order to facilitate warehouse operations and ensure that third-party sellers can guarantee a two-day delivery, Amazon introduced Fulfillment By Amazon (FBA) in September 2006. This new service allowed foreign sellers to test the waters in new markets such as Amazon Canada without the need of a warehouse. Still, a lot of market research needs to be done before selling on a new market. However, doing business on multiple markets is not only easier than ever, but also important in a globalized world like ours. Algopix helps you assess new markets by offering insights into seven different marketplaces worldwide. You will get valuable information regarding a product’s demand level in a foreign marketplace, the expenses associated with selling said product,the competition level,your estimated profit, product sales volume and gross merchandise volume (GMV) for the past month. This puts you in a great position to determine which marketplace is the most attractive for growing your business and increases your sales.
What to sell on Amazon Canada
Before making your first product listing, you have to search through hundreds of potential products to identify the most promising ones. Sellers on Amazon Canada’s marketplace on average have 55 products listed which means they probably researched thousands of products. Gaining insights in multiple products at once is almost impossible without a research platform like Algopix. Algopix’s Amazon Canada market research allows you to upload a CSV file containing up to 200 products and will deliver you high-quality, detailed information in a matter of minutes.