From the perspective of seller strength, companies in the cross-border industry are mainly small sellers. According to Amazon’s official seller data statistics, in 2021, about 350,000 sellers on the Amazon platform had annual sales exceeding $100,000, about 60,000 sellers had sales exceeding $1 million, about 3,300 sellers had annual sales exceeding $10 million, and 50 sellers had annual sales exceeding $100 million. More than half of these sellers are from Amazon’s US site, and the rest are distributed in the remaining 19 sites.
The total number of seller registrations in Amazon’s 20 sites worldwide has exceeded 6 million, and sellers with annual sales of $1 million account for less than 1% of the total number of sellers, but these less than 1% of sellers have completed more than half of Amazon’s sales on the entire platform, so most product development is in small startups, and this position is particularly important. Even the boss of many companies is the person in charge of product development. Most of these companies do not have the advantage of supply chain. Product development should be based on reality, mainly from the analysis of working time, funds, and their own characteristics.
Time in the industry
Amazon sellers who have been in the industry for less than 6 months are not clear about Amazon’s rules and the cyclicality of Amazon’s products, and do not have a deep understanding of operations, market changes, industry data, product features, supply chain resources, etc. If sellers do not understand enough, they should not develop products with high value, strong seasonality, many variants, and large volume. A complete sales cycle of Amazon products is at least one year. Sellers with more than 1 year can be exposed to seasonal goods, but it is difficult to grasp material control without two or three years of market observation and operation experience. It is recommended that sellers within 2 years focus on a certain vertical category of products and not rush to expand categories. If a seller’s category can be stable and profitable for more than 2 years, the risk resistance is stronger than many sellers. Next, they can invest in developing technically challenging products to establish their own threshold advantages in Amazon.
Funds
Funds are also a prerequisite for product selection. If a seller only has 10,000 yuan in start-up capital, it is difficult to make high-value products, and even more difficult to make FBA products, because it involves the cost of pressing goods, as well as subsequent promotion costs and goods turnover costs. Sellers with 10,000 yuan in funds are recommended to make low-value products. Sellers with relatively sufficient funds must be familiar with the basic process of Amazon operations, otherwise many risks are uncontrollable.
Own characteristics
Different types of Amazon sellers have different product development needs. If it is a small startup company, there are also popular products. The product demand of this type of company is mostly based on the market research done by the product manager or operation manager. If it is a listed company or a company to be listed, the products of this type of company are mostly limited to a certain category, and the product line is subdivided. The product demand is a fixed product category that the product manager is responsible for.