The economic ripple effect behind a single online purchase

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When a customer buys from an online seller, the transaction can generate economic activity far beyond the seller itself. The seller may buy supplies, hire workers, pay for services and invest in its business. Economists refer to this as the multiplier effect—economic activity generated by one business can support additional activity elsewhere in the economy. 

Multiple studies have shown that most of the money spent on independent businesses stays in the local community and generates a sizable economic impact.

A 2026 analysis by Oxford Economics, commissioned by Amazon, underscores the significance of that impact. The report estimates that independent sellers, which are mostly small and medium-sized businesses, operating in Amazon's U.S. store supported $183.9 billion in U.S. GDP in 2025. The analysis also found that their total economic impact was 3.2 times their direct economic impact: for every $100 in direct GDP generated by independent sellers, their activity was associated with $320 in total economic impact. The total includes the additional economic activity associated with sellers’ supply chains and wage-funded spending.  

Independent sellers are part of a much larger small-business economy. Small businesses accounted for 43.5% of the U.S. GDP and 45.9% of private-sector employment in 2025, according to the U.S. Small Business Administration's Office of Advocacy. The interviews below show how online sales translate the multiplier effect into practice and how this economic principle can vary by business. 

A home EV charger and a growing Texas manufacturer

Revitalize Charging Solutions, a Fort Worth, Texas, manufacturer founded by Edward Morgan, sells home EV chargers through e-commerce. Morgan says the company doesn't make every part of its chargers in-house, but instead uses other businesses in the Fort Worth area. Accurate Metal Stamping in Richland Hills, Texas, forms the aluminum enclosures and contract manufacturers in Richardson, Texas, populate the circuit boards the company's own engineers design. Fort Worth Electric handles installation and an in-house maintenance crew keeps the units running after the sale. 

"We keep that circle moving, allowing other folks to grow their business with us. We help each other," says Morgan, a Navy veteran who founded Revitalize Charging Solutions in 2015. 

Morgan says the company has four full-time employees, including engineers and operations and warehouse coordinators, all hired out of the Dallas–Fort Worth area.  

The company’s online sales have helped support plans to move into a 30,000-square-foot facility in nearby Arlington, Texas, Morgan says. The planned facility would include an assembly line, a testing lab, a design studio, with plans to hire an additional 30 new employees from local universities and the regional labor market. 

"If you're not selling the product, you're not going to hire the people," Morgan says.

A family farm keeps much of its supply chain close to home

Palouse Brand, a sixth-generation family farm near Pullman, Washington, now sells and ships wheat berries, lentils, and chickpeas, exclusively online (although pick-up can be arranged) since 2009. The business made the decision to sell online to reach more customers beyond their local community. 

Co-owner Sara Mader says they have intentionally kept much of Palouse’s supply chain close to the farm. They use local testing labs to ensure their products are meeting certain food quality standards, sustainable cardboard packaging makers to reduce their carbon footprint, regional transport firms to move their products from their farm to processing facilities and warehouses, and business services like accounting and legal, Mader explained. At one point they moved their cardboard sourcing from a supplier six hours away to one 60 to 90 minutes from the farm—reducing their emissions and supporting suppliers closer to their community. 

"It allows us to turn the economy around us. We have become the largest employer in the small town of Palouse, WA, which allows more families access to healthcare," says Mader. 

How a dog-cake business grew from a kitchen table into a factory

Portersville, a small town in Pennsylvania (last Census reported around 200 residents), is home to Puppy Cake, a manufacturer of dog birthday cake and treat mixes. The business began at Kelly Costello’s kitchen table in 2007, but has since grown into a 20,000-square-foot factory employing nine people, most of them women. As demand increased, Costello had to scale production, going from mixing and scooping by hand at home to investing in machines that filled 300 packets per hour and then 1,200 packets an hour. Now two machines fill 2,500 packets hourly. 

That growth has impacted the small community where Puppy Cake is based, with local grocers and pizza shops telling Costello that they started seeing an increase in sales soon after the business set up shop. 

Why this matters

Online businesses may seem like a one-click transaction, but behind that shopping cart, independent online sellers are contributing to broader economic activity.

"Follow any single order far enough and it stops being about the product,” said Laurence Wilse-Samson, lead economist at Oxford Economics. “It becomes a story about jobs, suppliers, and the towns where the money finally settles." 

Methodology

All figures are for 2025 and in 2025 prices and are Oxford Economics estimates unless otherwise stated. Economic impacts are estimated using an input-output modeling framework and a combination of confidential data provided by Amazon as well as secondary data from statistical authorities. Business-related claims are from an Amazon commissioned independent survey of 700 US-based independent sellers active in Amazon’s store. 

This story was produced by Amazon and reviewed and distributed by Stacker.