Amazon’s “bloody sea” categories and associated risks

On the Amazon platform, there are some categories with extremely fierce competition, which can be called a "bloodbath", and sellers need to be cautious when entering.

1. 3C electronics and small household appliances

1. Competition intensity : In the early years, going overseas to do 3C electronics was considered to have low costs and high profits, but now there are many players, and it has become the "king of the king of volume". Shenzhen Huaqiangbei is an important source of domestic 3C electronics wholesale, and its competition extends to the Amazon platform. For example, the categories of "Lucky Three Treasures" (mobile phone screen protectors, mobile phone cases, data cables) and "Calabash Brothers" (eye mask series, wireless charging series, etc.) products have a mature domestic supply chain system, but only the top merchants can play with it, and small sellers find it difficult to make a profit.

2. Risk factors

• Leading merchants may use "black technology", but they face the risk of store closure. Only merchants with strong resources, funds and strong risk resistance are suitable. It is not recommended for newbies or sellers with weak strength to enter.

2. Beauty and cosmetics category

1. Market status : It seems that the demand is high and the profit is good, but there is a serious monopoly among big sellers and a strong brand effect. In many small categories, the top 10 or even the top 20 products may belong to the same seller.

2. Risk factors

• The ingredients involved need to go through multiple certification and audit procedures and are easily removed from the platform. If you have no industry experience and qualifications, you should be cautious when entering.

3. Clothing Category

1. Competition and return issues : The clothing category, which is highly competitive in China, is also "competitive" abroad. The high return rate is a significant problem. It is common to see clothing products on Amazon with a return rate of 50% or even 60%. In addition, this category involves features such as color, style, and size, with many variants and SKUs, resulting in high inventory pressure.

2. For example , the return rate of swimsuits and skirts can even exceed 70%.

4. Toys Category

1. Market potential and risks coexist : the toy category is related to children, has a large market, and has a high chance of producing hit products. It has a good market on Amazon and other platforms.

2. Risk factors

• The risk of infringement is high. After the sales volume of products increases, they may be complained of infringement, resulting in being removed from the shelves or even the store being closed. They may also face situations such as freezing of funds or compensation. For example, in the pet category, dog toys and cat climbing frames, the competition for dog toys is fierce and the top players have serious monopoly; cat climbing frames require a large investment and are highly saturated due to their size, weight, purchase price, etc.

5. Other “Sinkhole” Categories and Products

1. Lighting Category

• The night light category is severely in-competitive, with frequent price wars and some products priced extremely low.

• There are many reviews of the top sellers of LED light strips, and the competition is fierce.

2. Home category

• The product categories of floor mats and shower curtains are inward-looking, with few opportunities for differentiation and fierce price wars for homogeneous products.

3. Mobile phone cases, tempered films, and data cables : It is not recommended to participate unless you have large funds or strong supply chain resources.

4. Kitchen products such as electronic food scales, kitchen thermometers, knife sharpeners, grill brushes and egg beaters were also complained about by many sellers.

When selecting products, sellers must be careful to avoid these highly competitive and high-risk categories and products to reduce operating risks and increase the chances of success.