Insight: What is Amazon and what benefits can you expect if you’re a small business?
Entrepreneur Raphael Cabrera talks about the potential of an Amazon operation in Puerto Rico.
It has not yet been specified how an Amazon fulfillment center would operate in Puerto Rico. Many people may not know that a large part of Amazon’s total revenue comes from third-party sellers, who are small businesses, whether they are private brands, wholesalers, or retail arbitrage sellers.
Although it is still a mystery whether the Puerto Rico fulfillment center will accept third-party sellers, what I can say is that if they treat Puerto Rico like a country, as they do in the United States, Canada and Europe within the FBA (Fulfillment by Amazon) or MF (Merchant Fulfilled) models, this would create a great opportunity for small business and importers, given that their products would be accessible across the entire island.
This means that if your product is located in the Amazon warehouse and you as a seller receives an order from Ponce, Amazon would handle the distribution, while your goal would simply be to continue developing your brand or, if you are a wholesaler or arbitrage seller, to keep adding products to continue generating sales on the platform. Amazon would charge about 15% of the total sale, depending on the category, plus a delivery fee.
If this were the case, a great economy would be created within the island, where internal capital would remain among the local sellers who decide to sell on the platform.
Additionally, it would generate enormous power for the island in terms of employment, with opportunities for independent Amazon carriers, warehouse employees and professional jobs, among others, either directly or indirectly through Amazon or by third-party sellers.
Author Raphael Cabrera is an entrepreneur with a decade of experience in small business, including owning a food business at age 21. He holds a bachelor’s degree in economics and finance from UMET, and owns Kanso Worldshop Inc., an e-commerce company that exports to Europe.
