Shopify is one of the most popular ecommerce platforms on the planet. And it’s no wonder. The platform makes it easy for businesses of all sizes to create an online store and sell their products to customers around the world.
But can Shopify really be as big as Amazon? Let’s take a look at the facts.
First, let’s look at the size of Shopify. The platform currently has over 1 million active stores and is growing at a rapid pace.
In 2017, Shopify had $10 billion in gross merchandise volume (GMV) and is on track to do $15 billion in GMV in 2018. This puts Shopify on par with other large ecommerce companies like eBay and Alibaba.
What’s more, Shopify is profitable and cash flow positive. This is rare for a company of its size and growth rate.
Most companies are loss-making when they are growing as quickly as Shopify. This gives the company a lot of financial flexibility to invest in its future growth.
Now let’s compare Shopify to Amazon. Amazon is definitely the 800-pound gorilla in the ecommerce space.
The company had $177 billion in net sales in 2017 and is growing at a rate of 30% per year. So there’s no doubt that Amazon is much bigger than Shopify.
But there are a few things to keep in mind when comparing the two companies. First, Amazon only started selling its own products (AmazonBasics) a few years ago.
Before that, it was primarily an marketplace for other businesses to sell their products on Amazon.com. So when you compare Shopify’s GMV to Amazon’s net sales, you’re not really comparing apples to apples.
Second, Amazon is much more than just an ecommerce company. The company also has a thriving cloud computing business (AWS), a streaming video service (Prime Video), and dozens of other businesses that contribute to its bottom line. So when you compare Shopify to Amazon, you’re really comparing a pure-play ecommerce company to a conglomerate with exposure to many different businesses.
Third, Amazon has been investing heavily in its own logistics network ( Prime Now, Amazon Fresh, etc.), which gives it an unfair advantage over other ecommerce companies that have to rely on third-party shipping providers like UPS and FedEx. This gives Amazon an important cost advantage that will be difficult for other companies to match.
All things considered, it’s hard to say whether Shopify can be as big as Amazon. On one hand, Shopify is growing very quickly and is already profitable and cash flow positive. On the other hand, Amazon is much larger and has many different businesses that contribute to its bottom line.
Conclusion:
Can Shopify Be as Big as Amazon?
It’s hard to say whether Shopify can be as big as Amazon.
