American return to Amazon Comment

One important component of Amazon’s success is the explosion of China-based businesses that sell products through its huge digital mall.

But starting over a year ago, Chinese businesses are constantly selling a smaller share of the things Americans buy on Amazon. US-based merchants are growing.

Experts have told me that they do not have a satisfactory explanation for this change in the balance of Amazon sellers in the US and China. They also could not say whether it was a short circuit or a long reversal of what has been a long-term trend of market share growth for Chinese traders.

At this point, most buyers would not notice that Chinese retailers sell relatively fewer items on Amazon. And change can be another example of the unpredictable shifts in shopping caused by the pandemic.

But Amazon’s aggressive efforts to pursue Chinese retailers over the past fifty years have led to profound and trendy changes in online retail and the global economy. If this phenomenon has lost its activity, it is worth seeing what it can mean for buyers, international trade and the millions of businesses that make a living from selling on Amazon and elsewhere online.

I will return to explain how Amazon works: the company operates partly as a regular store that resells products purchased from manufacturers, and partly as eBay. More than half of the products sold on Amazon come from this approach, similar to eBay, independent companies that list their products next to those sold by Amazon. If we buy a children’s game or phone charger on Amazon, chances are it’s really supplied by a toy company from Texas or a major Chinese electronics conglomerate.

Beginning around 2015, Amazon has made it much easier for retailers in China to list products for sale. It was copied by other retailers, including Walmart and the Chinese clothing company Shein, and it changed the experience of shopping online – both in a good way and in a bad way.

Chinese retailers have been a source of power to Amazon and one of the company’s biggest headaches. They are a big reason why you can find just about any product on Amazon, and they’ve probably helped lower prices for buyers. But Amazon critics also say the company has not done enough to protect buyers from unsafe or substandard products and from manipulated customer reviews from Chinese sellers who may be out of reach of U.S. consumer protection laws.

Over the past few years, Chinese retailers have sold an increasing percentage of what Americans buy on Amazon, until there was about a 50-50 split between sellers in the US and China. The percentage sold by Chinese retailers fell to 42% in May from about 48% in late 2020, according to e-commerce research company Marketplace Pulse.

Instead, U.S.-based sellers get the bulk of their sales. Amazon’s domestic retailers also sold more compared to Chinese retailers in the UK and Germany. (An Amazon spokesman declined to comment on the change in the mix of Chinese and domestic retailers.)

I asked Juozas Kaziukenas, founder of Marketplace Pulse, whether this transition from Chinese traders was caused by the temporary closure of factories in China due to the pandemic and the increased cost and complexity of shipping goods from Asia. He said probably not. Most retailers in the US buy and ship from manufacturers in China or other Asian countries.

Kaziukenas said it was difficult to know exactly what caused the change, but some traders were frustrated by rising costs and Byzantine rules on Amazon. From China, there have been reports of product vendors hoping to find websites other than Amazon to sell their goods to the world. However, these complaints about the shortcomings of sales on Amazon are certainly not new, and they are usually expressed by traders outside of China.

Yaniv Sarig, CEO of Aterian, an American retailer that sells products on Amazon, is one of the e-commerce experts who believe some Chinese businesses may have strayed from Amazon because they were intimidated by the company’s crackdown last year against some retailers . based in China, apparently to manipulate customer reviews.

Amazon’s market turmoil could be an opportunity for U.S.-based vendors, including such as Molson Hart, a toy seller from Texas who believes U.S. laws and policies give an unfair advantage to online sellers from China.

Finding out that the combination of sales of Chinese and domestic retailers has been changing over the years has left me with acute questions: if China’s prosperity of commodity sellers was a major change in online shopping, why didn’t it seem to affect shoppers when the trend changed? ?

I wondered if we had overestimated the benefits of opening Amazon to millions of product vendors. Perhaps having 20,000 blender options on one site won’t help anyone.

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