Amazon's B2B Marketplace Surpasses $25 Billion in Annual Sales (Just Three Years After Reaching $10 Billion)
When we last checked in with Amazon Business in 2018, the B2B e-commerce marketplace was set to top $10 billion in annual sales just three years after it launched. Now, three years after that, annual sales on the platform have topped $25 billion worldwide.
In 2018, Amazon reported that users of the platform included 55 Fortune 100 companies, 40% of the most populous local governments, more than half of the 100 biggest hospital systems and 80% of the 100 largest enrollment education organizations. Here's what we wrote at the time:
Those numbers are only surprising if you were cryogenically frozen in 1999 and are just now waking up, but it's impossible to understate their significance. In just four years, Amazon Business has made massive inroads into some of the largest B2B markets. Those buyers up there are all heavy-hitters in some of the largest B2B verticals, and Amazon has corralled them into one place on a platform specifically designed to meet all of their purchasing needs.
Unsurprisingly, that trend has continued in a big way. According to an Amazon press release, buyers on the platform now include more than 80 Fortune 100 companies, 90 of the 100 largest U.S. cities and counties, more than 75,000 nonprofits and 92 of the 100 largest U.S. hospital systems.
Happening now at re:Shape:
Alexandre Gagnon, VP just announced that we are serving…
5 million businesses worldwide
80 of the Fortune 100
92 of the 100 largest hospital systems
45 of the 50 state governments
— Amazon Business (@AmazonBusiness) March 18, 2021
If you're unfamiliar with Amazon Business, the platform serves as a procurement hub for businesses sourcing office supplies, IT products, breakroom supplies, wholesale and bulk items, industrial and restaurant supplies, and more. Items on the platform range from industrial degreasers to bubble hockey tables, and essentially everything in between (including PPE).
Buyers can sort or search by industry or product category. The platform supports corporate purchasing cards and offers quantity discounts, business-only pricing and other perks. It also recently introduced a diversity, equity and inclusion feature designed to connect buyers with small and diverse sellers.
Third-party sellers drive a significant portion of Amazon Business sales—more than half, according to Amazon. That's similar to what the company reported in 2018, though with overall annual sales now more than double 2018 totals, third-party sellers on the platform now account for some $12.5 billion in annual sales.
That represents a massive opportunity for businesses in the B2B space. And that opportunity should keep getting larger. According to Digital Commerce 360, investment analyst Colin Sebastian of R.W. Baird and Co. projected that Amazon Business will reach $80 billion in sales by 2025. In 2018, Sebastian predicted the platform would reach ... $25 billion by 2021. So there's reason to trust his projections.
And, yes, that opportunity extends to promo businesses. All manner of promotional products are available on Amazon Business, with the platform offering everything from basic branded items to, evidently, more complex programs.
"Amazon was an absolute life-saver for our department,” said Tony Coppola, manager of festival artist relations for Sundance Institute, in Amazon’s press release. “Logistically managing to send gift boxes to filmmakers and jurors around the world for this year’s virtual Sundance Film Festival would have been impossible without Amazon's help. The speed with which they were delivered and the customer service in dealing with issues was exceptional—we and the filmmakers are extremely grateful."
As we wrote before: "Amazon isn't going away. We may as well find a way to get along." Three years and $25 billion in annual sales later, that sentiment holds up.