Amazon platform aims at $8.2tn corporate market

Online retailer Amazon.com yesterday launched a new marketplace that will connect individual businesses with suppliers, giving it access to a fast-growing market worth more than $8.2tn (€7.4tn) in the US.

Amazon Business will give US businesses — from biotechnology companies to oil and gas firms — exclusive pricing and discounts for buying in bulk, free two-day shipping for orders over $49 (€44), tax exemption, and the option to get products delivered with an Amazon guarantee.

A business marketplace will extend Amazon’s role as a middleman for third-party vendors, which account for about 40% of its sales. It would also help Amazon gain an edge in the fast-growing business-to-business (B2B) online marketplace, which is likely to account for about 12% of B2B sales in the US by 2020, according to estimates by Forrester Research. Forrester estimates a compound annual growth rate of 7.7% in B2B ecommerce over the next five years.

“Now, business customers have access to products that are only available to businesses as well as business exclusive pricing on a number of products,” said Amazon vice-president Prentis Wilson.

Wilson said that multiple users would be allowed to use accounts with purchase and approval controls already set in their procurement systems, essential for business customers.

Amazon Business will be rolled out nationwide, in the US, across categories including office supplies, IT equipment, janitorial supplies, healthcare products, large industrial equipment, education, and food service supplies.

Hard-to-find items such as traffic signs, industrial deep fryers, antibodies, 55-gallon steel drums, and dent pullers will be some of the products available on the platform.

Last month, the company launched a home services marketplace that connects customers with electricians, plumbers and painters in a move to have its services tied to every product sold on its website.

Reuters