How much startup capital do I need for an Amazon business?

The capital you need varies considerably depending on the business model. For Amazon FBA with private-label products, plan on roughly $3,000 to $10,000 to fund your first inventory, product photography and marketing. With the arbitrage model (buying and reselling), you can start with as little as $500 to $1,000. The important thing is to budget a buffer for unexpected costs and not pour your entire capital into the first order.

Can I start an Amazon business as a side hustle?

Yes, an Amazon business is excellent to build on the side. Many successful sellers started exactly that way. Thanks to Amazon's FBA service (Fulfillment by Amazon), Amazon handles storage, shipping and customer service, which dramatically reduces the time commitment. With efficient time management and the right tools for automation, you can start with 10-15 hours per week and scale the business as it succeeds.

Which products are best suited for getting started on Amazon?

Ideal starter products are light, durable and not seasonal. Avoid complex electronics, food or products with high regulatory requirements. Look for niches with stable demand but manageable competition. Products with a selling price between $15 and $50 often offer the best balance between margin and willingness to buy. Use market-analysis tools to check demand and competition before you enter.

How quickly can I expect profits?

The time to your first profit depends on your strategy and product choice. Realistic expectations are 3-6 months to break-even and 6-12 months to stable monthly profits. The key lies in the right product selection, optimized listings and a well-thought-out PPC strategy. Patience matters: the most successful sellers see Amazon as a long-term business, not as quick money.

What are the biggest risks of an Amazon business?

The main risks include: dependence on a single marketplace, fluctuating Amazon fees, intense competition and counterfeit products from competitors. You can minimize these risks by offering multiple products, protecting your brand (Amazon Brand Registry), diversifying onto other channels and consistently ensuring the quality of your products. Solid cash-flow management is equally crucial.

Do I need a registered business to sell on Amazon?

Yes, to sell regularly on Amazon you need to operate as a registered business and comply with the requirements in your country. In the United States, that usually means registering your business with the relevant state authority and obtaining the necessary tax IDs (such as an EIN and any sales-tax permits). A professional Amazon seller account also requires a valid credit card and a bank account. Be sure to also look into any product approvals and safety or labeling requirements that apply to your category.

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Amazon Business

Online Business on Amazon: How to Sell on Amazon and Why It Works

Last updated: March 16, 2025

Reading time: approx. 10 minutes

Online retail is booming like never before. While brick-and-mortar stores struggle in many segments, e-commerce posts double-digit growth rates year after year. And right in the middle of it all sits Amazon as the undisputed market leader, offering sellers a unique opportunity.

Whether you are just starting to toy with the idea of building your own online business on Amazon, or have already gained some experience: in this article we show you with concrete numbers and facts why Amazon is the ideal platform for your e-commerce success — and how to make the most of selling on Amazon, even as a beginner.

Why Amazon is the ideal starting point for your online business

Amazon has long been far more than just an online shop. It is the digital storefront for millions of products and the first port of call for consumers searching for just about anything. What Google once was, Amazon is today for many product searches: the platform where buying decisions begin and end.

For sellers, that means a unique advantage: you do not have to build your own website or run elaborate marketing to attract visitors. The customers are already there. They are actively searching for products and ready to buy. Your only job is to be visible at the right moment.

0 M

Products on Amazon worldwide

0 M+

Prime members worldwide

$0 B

Revenue 2023

Amazon has revolutionized the way people shop. For sellers, that is a huge opportunity: you reach millions of potential customers without having to generate traffic yourself. The key is to turn that reach into profitable sales through smart strategies.
Thorsten MüllerCEO at HORAiZON & Amazon Ads expert

Numbers that convince: the e-commerce boom on Amazon

The development of online retail speaks an unmistakable language. E-commerce revenue has grown continuously in recent years and has overtaken brick-and-mortar retail in many categories.

0%+

of all online product searches start on Amazon

active third-party sellers on Amazon

0 M

Prime members in the U.S. alone

of sales come from third-party sellers

Market shares in U.S. online retail

Amazon38%

Walmart6%

Apple4%

eBay3%

Others49%

These numbers show: Amazon is not only huge, it also offers enormous opportunities especially to small and mid-sized sellers. More than half of all sales on the platform are generated by independent sellers like you — not by Amazon itself.

U.S. e-commerce growth

598

2019

762

2020

871

2021

904

2022

1040

2023

1192

2024

Revenue in $ billion (B2C e-commerce)

Online vs. brick-and-mortar: the clear advantages of selling on Amazon

Brick-and-mortar retail has its place, but the advantages of selling online through Amazon are superior in many areas. Here is a direct comparison:

Head-to-head: startup costs

Investment needed to start

Ongoing fixed costs/month

Time to break-even

Brick-and-mortar retail

High upfront investment
Limited local reach
Opening hours: 6 a.m.-8 p.m.
Staff needed from day 1
Tied to a location

Amazon business

Start from $3,000
National & international
Sell 24/7
Scalable with growth
Location-independent

Especially worth highlighting: with Amazon FBA (Fulfillment by Amazon) you can outsource storage, shipping and even customer service to Amazon. That lets you focus fully on product development and marketing.

The 5 decisive success factors for your Amazon business

Not every Amazon seller automatically succeeds. The difference between thriving businesses and those that fail lies in the consistent execution of these five factors:

Success rates by number of factors implemented

0-1 factors

15%

2-3 factors

45%

4-5 factors

78%

* Share of sellers with a positive ROI after 12 months

Product selection backed by data

Successful sellers do not rely on gut feeling. They use market-analysis tools, examine demand, competition and margins before they launch a product. The right niche is the cornerstone for everything that follows.

Optimized product listings

Your listing is your salesperson. Professional product photos, keyword-optimized titles and bullet points as well as persuasive A+ Content make the difference between a click and a purchase.

Strategic Amazon PPC

Organic visibility alone is rarely enough. With targeted PPC campaigns you put your products in front of ready-to-buy customers and gather valuable data for optimization.

Review management

Positive reviews are your most important asset on Amazon. They influence ranking, conversion rate and customer trust. Delivering quality and proactively asking for feedback is essential.

Continuous optimization

The Amazon marketplace is dynamic. Competitors come and go, algorithms change. Anyone who wants to succeed long term has to review and adjust their strategy regularly.

The greatest strength of successful Amazon sellers is their willingness to learn from data. Those who know and understand their KPIs can optimize in a targeted way. Those who only react instead of acting proactively fall behind the competition.
Tim KraseCTO at HORAiZON

Getting started in practice: how to launch successfully

The path to your own Amazon business is clearly structured. Here are the concrete steps you should take:

Phase 11-2 weeks

Preparation

Register your business and obtain your tax IDs
Create an Amazon Seller Central account
Choose a business model (private label, wholesale, arbitrage)

Phase 22-4 weeks

Product research

Run a market analysis with specialized tools
Evaluate competition and demand
Find suppliers and order samples

Phase 32-3 weeks

Launch

Have professional product photos created
Create a keyword-optimized listing
Start PPC campaigns for visibility

Phase 4Ongoing

Growth

Analyze and optimize performance
Expand your product portfolio
Build and protect your brand (Brand Registry)

Conclusion: Amazon as a springboard for your e-commerce success

Selling online through Amazon offers opportunities that would have been unthinkable just a few decades ago. With comparatively little startup capital, without your own physical store and with access to millions of ready-to-buy customers, you can build a profitable business.

lower startup costs

0/7

selling time

0 M

potential customers

third-party share

The most important takeaways:

Low barriers to entry: compared to brick-and-mortar retail, you can start with significantly less capital and risk
Scalability: Amazon FBA enables growth without a proportional increase in effort
Reach: millions of customers actively search for products on Amazon every day
Data-driven: success is based on analysis and continuous optimization

The key to success does not lie in luck, but in a well-founded strategy, high-quality products and the willingness to learn and optimize continuously. With the right tools and the necessary know-how, nothing stands in the way of your successful Amazon business.

Ready to take your Amazon business to the next level?

With HORAiZON ONE you automate your PPC optimization and maximize your profitability.

Try it for free now

Frequently asked questions about an online business on Amazon

About the author

Thorsten Müller

CEO at HORAiZON & Amazon Ads expert

Thorsten has been active in the Amazon ecosystem for over 10 years and, together with his team, has already helped hundreds of sellers make their Amazon Advertising more profitable.