A handful of New Jersey small business owners who realize significant revenues as independent sellers on Amazon, gathered at the Statehouse in Trenton yesterday. In celebration of National Small Business Week, their mission was to make legislators realize that Amazon is not just a global e-commerce giant with a vast network of warehouses and 1.54 million employees worldwide whose founder dabbles in space exploration.
Their message yesterday was that Amazon is the vital digital storefront for mom-and-pop shops today. In fact, more than 60% of Amazon sales are from independent sellers, most of which are small- and medium-sized businesses. Last year, as it celebrated its 25th anniversary of partnering with independent sellers, Amazon reported the relationship generated $2.5 trillion in sales for these businesses.
In New Jersey, independent sellers sold more than 284 million items on the platform last year, and the average annual sales per seller was more than $540,000.
For Iman McDonnaugh-Brown, founder of Wonderfully Made, which makes authentic Trinidadian hot peppers sauces stemming from her grandmother’s recipes, the day’s event was about having conversations with legislators on how Amazon supports small businesses.
“It’s understandable why so many people, who aren’t involved on the entrepreneurial side of things, think that Amazon is just this giant company. However, I don’t think Amazon would really exist the same way it is if it weren’t for small businesses that make up a large portion of its sales volume,” McDonnaugh-Brown, explained. “So, today’s event is a neat opportunity to get in front of [legislators] and remind them that when they’re making decisions [that impact Amazon], they’re also affecting neighborhood [businesses].”
McDonnaugh-Brown started her Metuchen-based company with her husband in January of 2020, just as the COVID-19 pandemic was about to hit. She immediately signed up as an independent seller with Amazon because the e-commerce platform already had “the trust of online shoppers.”
She estimates that 40% of her sales are from Amazon today. “Outside of that, it’s direct-to-consumer sales via the Wonderfully Made website and attending various food markets.
Dr. Anton Shcherbakov, a licensed psychologist and board-certified behavior analyst, is the co-founder of ThinkPsych, a Lumberton-based company that produces social and emotional learning toys and games for children and now adults.
Founded in 2019, ThinkPsych became an Amazon independent seller in 2020, because, as Dr. Shcherbakov explains, “Running our own company logistics operation was not going to be feasible. We contacted [other delivery services] and realized we weren’t going to have any margin left.
“We really needed someone who was going to take care of all the logistics and do it at an affordable rate. We couldn’t afford to rent a warehouse, have a fulfillment staff, and pay for all the materials and supplies, etc.,” Dr. Shcherbakov said.
He explained that signing up with Amazon via its website was a straightforward process. He recalls that after company inventory made it to the US from China, it went to an Amazon warehouse. ThinkPsych began having sales within the first few days after that. Today, Amazone represents 95% of the company’s overall $1 million sales.
Though the company pays fees to Amazon for its various services, Dr. Shcherbakov says it is still less expensive than going through other sales channels.
When Fairy Tales Hair Care joined Amazon as an independent seller in 2012, the Fairfield-based children’s hair products company, which was founded in 1999, had sales of $4 million. Today, the company reported revenues of $32 million with Amazon sales representing 55% of the total.
According to CEO and founder Risa Barash, “Amazon is focused on setting small businesses up for success.”
Discussing Independent Sellers Day at the Statehouse, Fairy Tales Hair Care COO Abbie Mietz commented, “We want to make sure government understands the role of Amazon and small businesses like ours in New Jersey. Amazon not only impacts us as a business, but the employees who work for us, and the ability for customers to get what they need in a timely fashion.
“I think [some legislators] view Amazon as a large corporation. They don’t tie that back to small businesses. Today, they get to see that through our stories. Amazon is not just for the Nikes of the world, it’s for all these small businesses that rely on it to get new customers, grow their businesses, and feed their families.”
At Runnemede-based Imposta Costumes, a family-run costume company founded in 1992, COO Jodi Berman said that company began selling on Amazon in 2001. Today, Amazon revenues make up 20% of company sales.
“It’s been tremendous for our business. … It’s Amazon, right?” she said. “If you’re going to be selling online, you have to be on Amazon. It is integral to any business.”
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