Economics in Brief: Fees to Small Businesses Are Amazon’s Largest Revenue Source, Report Finds – Next City – DC Initiative on Racial Equity
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Amazon’s Largest Revenue Source? High Fees Charged to Small Businesses That Sell on the Platform, Report Finds

In 2021, Amazon stood to collect about $121 billion just in fees and advertising revenue from third-party small-business sellers on Amazon Marketplace, according to a new report by the Institute for Local Self-Reliance. On a granular level, this translates to sellers on Amazon’s Marketplace turning over roughly 34% of every sale to the online retailer.

Both TechCrunch and The Verge report that this represents the tech behemoth’s largest source of revenue, up from some $60 billion in 2019. Previously, Amazon Web Services (AWS) had been considered the company’s biggest “cash cow.” But according to the ILSR report, Amazon’s Toll Road, “Drawing on analysts’ estimates of the margins Amazon likely earns on seller advertising and other seller fees, we find that Marketplace may have generated operating profits of $24 billion

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