Amazon is the world’s largest online retailer with a year-over-year growth in retail product sales of 19% in 2017. Third-party sellers on Amazon’s marketplaces are a leading factor in this, which becomes clear considering that their share of Amazon’s total sales is above 50%. With 140,000 Amazon sellers making annual revenue of more than $100,000, it is evident that doing business on Amazon is profitable for sellers and stays attractive to new online sellers.
Amazon’s UK marketplace was launched in March 2002, enabling third-party sellers to sell products to Amazon’s customers alongside Amazon’s offerings. Meanwhile, it has grown to be the second largest marketplace in Europe and one of the top marketplaces for non-UK sellers to do business. FBA, the close proximity of the European marketplaces, and the European Fulfillment Network (EFN) made this possible, which is why Amazon UK, Germany, France, Spain, and Italy are sometime seen as one big marketplace. With over 150 million products offered by almost 200,000 sellers, Amazon UK also offers a vast selection of different products.
Amazon UK market research insight
Given the increasing share of internet users shopping online, more and more sellers establish an online presence thereby increasing competition on marketplaces like Amazon or eBay. This makes finding promising products with little competition quite difficult. With the help of Algopix’s Amazon UK market research insights into your competition level for a given product, identifying profitable products for your business becomes much easier. Valuable, high-quality intel on your competitors allows you to position yourself on Amazon UK so you to stand out from competitors, and helps you with your pricing strategy, thereby increasing your chances in winning the Buy Box Offering.
Strict performance targets like a late shipping rate below 4% makes using Fulfillment by Amazon (FBA) inevitable
The introduction of FBA in September 2006 enabled third-party sellers to use Amazon’s storage facilities to outsource their warehouse operations. If you want to take advantage of this service, fees will apply such as fulfillment fees, and monthly inventory storage fees. These costs directly affect your profit margins and makes calculating your costs more complex, since fees vary depending on the size and weight of the product. With Algopix’s Full Expenses Analysis you will always keep an overview over any costs associated to selling your products on Amazon’s marketplace, no matter the marketplace fees, shipping fees, taxes, or FBA fees.
Algopix’s Amazon UK product research tool
Marketplaces offer great advantages to sellers by providing a platform to sell to millions of potential customers. As is present in most cases of technological innovation, there are drawbacks to this platform.. In the case of Amazon’s marketplace, more and more manufacturers from China are discovering that it is more profitable for them to cut out the middlemen, i.e. retailers, and sell their products directly to customers. This allows them to price their products much lower than their competitors. While this is beneficial for the consumer, it poses a danger to online sellers because they are forced to lower their prices too in order to stay competitive. This decreases not only profit margins but also affects the sales volume, directly affecting the chances for the online seller to sustain a profitable business.
Algopix’s Amazon UK product research tool will automatically calculate the expected profit for a product you are searching for by considering the purchasing price you previously provided and the expenses that come with selling your product on Amazon UK. Additionally, Algopix’s Amazon UK marketplace research delivers you a product’s sales volume and gross merchandise volume for the past month, thereby allowing you to get an idea of how many units you will be able to sell. With this information right at your fingertips, you are able to source the most profitable products with a large enough profit margin and make educated decisions for your online business in no time.
An increasing amount of non-UK based sellers are coming to Amazon UK
Europe is the home to five different Amazon marketplaces that are in close proximity to one another: UK, Germany, France, Spain, and Italy. While FBA already allowed non-UK sellers to do business on Amazon UK, Amazon’s development of the European Fulfillment Network (EFN) pushed this trend onwards. Thanks to EFN, European Amazon sellers can offer their products on all five European marketplaces while only needing one seller account. In the meantime, more than 50% of Amazon sellers in Europe do business in at least two marketplaces, with Amazon UK being the most attractive destination.
Amazon UK sellers are lagging behind in this regard with only around 33% selling on other European markets and are thereby missing out on this huge opportunity. While judging new markets is never easy, globalization demands it of online businesses in order to stay ahead of the competition. By providing intel on seven different Amazon marketplaces, Algopix’s Amazon UK seller tool accelerates the process of identifying new markets. It’s intuitive, easy-to-read interface delivers information about a product’s demand level, expenses, competition level,estimated profit, sales volume and gross merchandise volume (GMV) for the past month.
There are hundreds of products that sellers must to go through to find one or two that are worth selling
Any modern Amazon seller offers more than a handful of products,as that is what is required to keep one’s business running In the UK alone, Amazon sellers offer on average around 350 products;however, merchants using FBA have significantly less products in their catalogue. In order to get close to this number without sourcing products that make you lose money you have to go through thousands of different products. This depletes many resources and time which can be used for more important business tasks. For this reason, Algopix’s Amazon UK product research allows you to analyze up to 200 products at a time while still delivering the same high-quality, in-depth information as though you were researching one product at a time.