E-commerce sellers worldwide is 46.75 million and their accounting market size is $2 billion

Insights: The current market size in terms of revenue of the e-commerce accounting and/or inventory software for these sellers was estimated to be about $1.99 billion. The total addressable market value for the accounting and inventory software targeting the 46.75 million e-commerce sellers will reach $23.37 billion in global figure, assuming a 100% market penetration.

About this report: From this market research of the e-commerce industry, you will be able to know the current market trend in terms of market size of the e-commerce sellers industry. We’ve also provided analysis of the possible total addressable market value for e-commerce accounting and inventory software globally targeting online sellers for Amazon, eBay, and other e-commerce platforms.

OVERVIEW OF THE E-COMMERCE INDUSTRY WORLDWIDE

The total number of e-commerce sellers worldwide is approximately at 46.75 million. These e-commerce sellers are retailers, merchants and seller from all e-commerce platforms such as Amazon, eBay, and Taobao (or Alibaba).

The current market size in terms of revenue of the e-commerce accounting and/or inventory software for these sellers was estimated to be about $1.99 billion. The total addressable market value for the accounting and inventory software targeting the 46.75 million e-commerce sellers will reach $23.37 billion in global figure, assuming a 100% market penetration.

Accounting and Inventory Software Market Size and total addressable market (TAM) for e-commerce sellers — E-commerce sellers total addressable market

FINDINGS

THE E-COMMERCE SOFTWARE MARKET SIZE

Overall, the e-commerce software (all software not just accounting) market size globally was valued at $3.8 billion in 2017.

While if we consider the whole accounting software targeting all industry–not just retail and e-commerce– the total current market size would be $17.35 billion which will poised an annual growth rate of 8.92%. According to this report, the retail and e-commerce sector play a substantial role in the accounting software industry.

ACCOUNTING/INVENTORY SOFTWARE TARGETING E-COMMERCE SELLERS MARKET SIZE

There was no available report that could directly quote the market size of the specific target audience, thus, we calculated this value using a bottom-up analysis method and using reliable statistics and data.

In the small business world (including e-commerce retailers) , Quickbooks is reported to be the most used accounting software and it has more than 80% (or about 85%) market share in this industry.

Currently, Quickbooks has over 3.4 million subscribers according to their annual report. If these 3.4 million users are assumed to be in the e-commerce industry, then we estimated that about 4 million online sellers are currently using accounting software.

Estimated number of e-commerce sellers using accounting software

= 3.4 million / 85%

= 4 million

In terms of value, we consider Quickbooks average annual premier plus cost at $499.95;

Estimated e-commerce accounting software for sellers market size

= 4 million * $499.95

= $1.99 billion

TOTAL ADDRESSABLE MARKET OF ACCOUNTING SOFTWARE FOR E-COMMERCE SELLERS

TARGET AUDIENCE

To estimate the number of e-sellers/e-retailers, all those sellers selling online normally through e-commerce marketplaces such as Amazon and eBay, we considered various data.

According to a report, 40% of all e-commerce marketplace are from the top 5 e-commerce companies. The top 5 e-commerce platform companies in the world are Taobao, Amazon, Walmart, eBay, and Target.

First, we look at the available statistics of these 5 companies.

Nearly 7 million active sellers on Taobao
There are over 5 million marketplace sellers across all Amazon marketplaces
Walmart has about 400 retailers or third party sellers using their marketplace. While Target has just about 60 third-party retailers in their platform.
In 2017, 6.7 million sellers on eBay sold products in 190 markets around the world, and for small businesses, the platform has become a great source of revenue.

[Calculations]

Total e-commerce sellers from the above top 5 companies

= 18,700,460

Since the top 5 companies has a market share of 40% in terms of number of retailers/sellers, we divide the figure by 40% to get the total e-commerce seller market size globally.

Estimated number of e-commerce sellers globally

= 18,700,460 / 40%

= 46.75 million

If based on small business owners (which include retailers, either they have an employee or self-employed), according to a survey, 64.4% of these use accounting software. Assuming this trend is similarly the same with e-retailers, then we estimated that about 30.11 million e-commerce sellers are already using some kind of accounting and inventory software.

If assuming a 100% penetration, then this industry will be valued about $23.37 billion.

TAM Value based on revenue

= 46.75 million * $499.95

= $23.37 billion

Estimated number of sellers that use multi-channel

According to a report, about 80% of all Amazon sellers also use other platforms to sell their products, either on eBay, Jet, own website, Walmart, Newegg, Sears, among others. If we assume that in all platforms, 80% of their sellers use other website and just 20% are selling in one platform, then our rough estimate is that of the total 46.75 e-commerce sellers registered on all platforms, about 12.47 million are sellers that use at least 3 platforms.

Our estimate is based on the below assumptions;

We took 20% of all total sellers from the biggest marketplaces and assume this number to be those sellers which only sell on that platform;

46.75 million * 20% = 9.35 million

46.75 million * 80% = 37.40 million

Of this total 80% registered sellers, it could be possible that most of them sell on average 3 platforms, using this assumption to calculate the total per headcount;

Estimated number of sellers who sell on 3 platforms

= 37.40 million / 3 = 12.47 million

Online platform number of registered sellers

Amazon = 5 million
Taobao = 7 million
eBay = 6.7 million
Jet.com = 2,400
Sears = 14,000
Walmart and Target = 460
Rakuten = 44,000
All others (own website and other bigger marketplaces which reportedly about 50 globally) = 27.99 million

In conclusion, about 12.47 million are sellers that use at least 3 platform and about 9.35 million use just one platform–either their own website or using e-commerce marketplace.

SOURCES:

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