Amazon Sellers - Risks and Benefits

March 22, 2025

by a professional from Northwestern University - Kellogg School of Management in Southborough, MA, USA

Hi - I see a lot of my network and the people on this site say they're buying amazon sellers and businesses. I am curious about experiences doing so - it seems so risky to me, when you're successful, Amazon likely wants to launch a basics competitor. It also looks to be fully PPC based which is another bummer in a lot of ways. I'd love to hear why people love this type of business, because I admit a company like this would be great for a family member of mine.

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Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA

We have found a lot of lenders are cautious about businesses that only sell on Amazon. If it is a niche product that is hard for Amazon to compete with, then lenders are more comfortable. But if it is a commodity product that anyone can sell, lenders get very nervous about competition. The other issue is that Amazon has raised its costs, making it harder to be competitive. You want to be sure you factor in cost increases into historical cash flow. if they are selling through other sources as well as Amazon, lenders view it less risky. Happy to have a discussion and take a look at anything you are working on. You can reach me here or directly at redacted

Reply by a searcher
from University of California, Irvine in Irvine, CA, USA

I suggest joining a few Facebook groups for Amazon sellers. It'll give you a good idea of the challenges one faces when running a business on Amazon. Amazon-based businesses are fairly easy to run, but there's a constant fear that it could all come crashing down due to blackhat competitors or sudden Amazon policy changes.

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