There's a perception in B2B circles that the only products that sell well on Amazon are small, easily packaged, consumer-oriented products like phone cases and cables, t-shirts, cookware, etc. In some ways, that's valid because historically Amazon has done the vast majority of its sales in high-volume, commoditized con DRAFTJS_BLOCK_KEY:efk4oin his 2022 shareholder letter, "[We] plan to keep building the features our business customers tell us they need and want."
As a result, B2B firms often ask us: Will our products actually sell on Amazon? It’s a legitimate question given that business buyers frequently require deeper information about how a product fits into their own business processes.
And in many cases, the answer to their question is surprisingly yes!
The truth is that Amazon business is now driving over $35 billion in sales of B2B products annually. And as we look across the assortment of B2B products on Amazon, it's not just commodity, low-priced, and small products. In fact, products range from industrial fans with 12-foot wingspans to FDA-approved medical devices that require a medical license to purchase.
We see this first hand at Enceiba, where we work with clients across a wide variety of industries, including HVAC, industrial products, automotive products, and many other categories. We see first-hand that products that require more detailed information, that are bigger, more expensive, or that need to have specific compatibility information or have a specific B2B applications will sell on Amazon, often at high volumes.
We're not just talking about size, but type. We work with companies like Grasshopper, which manufacturers and sells commercial lawn mowers, Dynabrade, a leading producer of professional pneumatic tools, and Hanes Supply, an industrial products manufacturer.
These companies all sell products that are complex, whose buyers need to obtain a higher level of information beyond basic product specs, such as technical info, compatibility requirements, power requirements, etc. before they make their purchase. They’re not just basic commoditized products, either. They’re complex B2B products. What’s more, the products these companies sell couldn’t be more different or varied, yet their growing sales volume proves that it's about demand for their products, not just type, size, or price point.
So why do these companies’ products succeed where others fail? The simple answer is that selling these more complex B2B products successfully on Amazon requires following a set of well-defined best practices. That means properly setting up and establishing an Amazon presence, leveraging all the tools and benefits of selling through Amazon Business, and tapping into Amazon’s B2B features to attract, reach and convert business buyers.
For example, if you're selling regulated medical products like American Orthodontics, you need to set up Amazon Business to restrict sales to only licensed medical professionals, which includes submitting FDA compliance certificates and other documentation. If you don't do this correctly, you won't be allowed to sell your products to them. Your products may not even be shown to buyers at all.
You also need to ensure your products have the right technical data and documentation that business buyers need to make sure they are purchasing the exact product for their specific application. Grasshopper Lawnmowers, which we mention above, provides technical drawings and specs to ensure customers purchase accessories and parts that will be compatible with their existing units. That is an additional layer of product data that’s needed that goes beyond basic product information.
In the Amazon world, business buyers also expect the ability to purchase in bulk or access tiered pricing specific to their needs, not just pay the consumer retail price. While many Amazon sales are one-off, you also need to be set up to handle larger orders as well.
With more B2B buyers turning to Amazon for product research and purchasing, it's more important than ever that B2B manufacturers recognize that their products already are being sold on Amazon, and increasingly will be. Even large, complex and expensive products—like a $4,000 Big Ass Fan—sell regularly on Amazon. Some of our clients at Enceiba are generating as much as 40% incremental revenue through their Amazon B2B sales; revenue they would never have captured if their Amazon presence wasn’t set up properly.
The bottom line is that B2B sales on Amazon are growing faster than any other, as noted in Amazon’s recent earnings report. This is happening because Amazon is investing heavily in B2B. Amazon is leaning into B2B and adding more functionality to remove barriers to these types of purchases. As Amazon CEO Andy Jassy said in his 2022 shareholder letter, "[We] plan to keep building the features our business customers tell us they need and want."
The opportunity is there for B2B manufacturers, but they need to take the time to understand how to tap into it.
If you’re a B2B manufacturer who wants to start or grow an Amazon Business presence, we can help! Contact us to talk about how your business can prosper on the world’s largest marketplace!