A recent study by the U.S. Chamber of Commerce revealed that Mississippi, Nebraska and Maine are the three states where small to medium businesses have grown the most year over year. This is according to sales in Amazon stores, specifically. More than half of the items sold in Amazon stores are from small to medium businesses.
"We're thrilled to see so many small businesses in states with large rural populations like Mississippi, Maine, Vermont and North Dakota growing their sales fastest in our stores," said Nick Denissen, vice president at Amazon. "Online selling enables rural businesses to complement their offline sales in physical stores by reaching customers they wouldn't otherwise have access to as easily. Research shows that increased adoption of online tools and digital services could grow annual revenues of rural small businesses by 21% over the next three years and create 360,000 jobs in rural communities. Amazon continues to invest billions of dollars to develop tools and services that help small businesses reach new customers."
The top 10 fastest-growing states break down as follows:
- North Dakota
The report looked at year-over-year sales growth in Amazon stores across 50 states. The third-party physical product sales, which is what gets sold on Amazon stores primarily, passed $160 billion in 2018. Nearly 20% of rural small businesses generate 80% of their revenue by selling products online. And the digital potential of rural small business could add $47 billion to the GDP per year.
The study also found that online tools make the biggest impact on rural small businesses that earn less than $100,000. One of those tools, in theory, is Amazon Handmade and Amazon Storefronts.
"Small businesses in rural America are significant contributors to the U.S. economy," said Tim Day, senior vice president of C_TEC, the U.S. Chamber of Commerce's technology engagement center. "Access to digital tools allows rural small businesses to successfully start, scale and compete in a global economy – regardless of their size and location."
Mississippi's economy grows slower than average – 1.6% overall versus the 2.2% nationwide average. Small business makes up 96.3% of the employers in the state.
Amazon Storefronts lets small to medium businesses create a separate section where it highlights curated collections of unique products. Amazon claims that Storefronts contains a curated collection of more than 1 million products and deals from 20,000 small to medium businesses. You can sign up for more information about this expansion by visiting www.amazon.com/storefrontsinfo.
"Since joining Amazon Handmade in 2015, my sales have doubled year over year," said Casey Everett, owner of Hearth and Harrow, based in Rockport, Maine. "Selling online has allowed me to create a business I love in a community that I love. With Amazon, I'm able to reach customers in Germany from my home studio in Maine – it's incredible."
In a competing study, Lending Club and Guidant Financial found that California, Florida and Texas ruled the roost in terms of small business in 2018. In that study, New York and Illinois round out the top five. It surveyed 2,700 current and aspiring business owners across the country.