The fast-changing landscape of Indian commerce has two main selling platforms; one is Amazon’s online marketplace and other is the Government e-Marketplace (GeM). Both have great potential for growth however the two systems functions under entirely different economic models, buyer behaviour patterns and revenue generation expectations of each system.
Let us now provide a detailed comparison of the two systems using real time data in conjunction with an economic background of how both systems work and some action steps for your business to take advantage of these opportunities.
The Fundamental Difference: Retail Market vs Institutional Procurement
When comparing earning potential, you will find the fundamental difference in the two characteristics of data and economic environment and how it affects your profitability, consumers versus government buyers, and the economic bases for both. All these facts stem from the fact that Amazon is a retail sales channel driven by many consumer behaviors, (i.e., demands from individual consumers, impulsive purchase decisions, seasonal buying patterns, product advertising, competitive price points) whereas GeM is a procurement channel of government only.
Thus, this major difference impacts all facets of a business including pricing strategies, volume sales, future sales revenue, etc.
Understanding the Scale: Amazon vs GeM
Amazon Marketplace (India)
Amazon is India’s largest consumer e-commerce marketplace, with millions of sellers offering everything from electronics to fashion to groceries.
In FY25, Amazon Seller Services (which operates the marketplace business in India) reported revenue of about ₹30,139 crore, up from ₹25,406 crore in FY24 - showcasing strong growth and a sharp reduction in losses through operational efficiency and marketplace monetisation.
Although Amazon’s marketplace business is large, margins for individual third-party sellers can be tight because of high commission fees, advertising costs, logistics charges, and intense competitive pricing.
Amazon does not publicly disclose how much individual sellers earn on average, but it is well understood that:
- Pricing pressure is intense due to high competition.
- Large sellers often dominate the revenue share.
- A few big accounts can generate huge volumes, while smaller sellers struggle with margin compression.
Industry discussions and platform data suggest Amazon’s revenue per transaction is high, and average consumer order values around ₹1,600 or more are common in many categories, reflecting high ticket size per sale on the platform.
GeM: Government e-Marketplace
GeM is India’s official public procurement portal, designed specifically for buying and selling goods and services to government departments, agencies, and public-sector entities. Unlike Amazon, the entire purpose of GeM is public procurement, not retail consumption.
Here’s how GeM’s scale compares:
- GeM surpassed ₹5 lakh crore in Gross Merchandise Value (GMV) in FY 2024–25, crossing this milestone more than 18 days before the financial year ended.
- As of late 2025, GeM has recorded over 11 lakh registered Micro and Small Enterprise (MSE) sellers, securing orders worth more than ₹7 lakh crore and accounting for over 44% of total order value - far exceeding the mandated 25% MSE procurement.
- Cumulative GMV since inception has crossed ₹15 lakh crore, underlining GeM’s role as one of the largest digital public procurement platforms in the world.
- As of February 2025, more than 22 lakh sellers and service providers were registered on GeM, making it one of India’s largest procurement ecosystems by seller base.
Crucially, GeM directs real government spending towards sellers - often in high-value categories such as infrastructure services, IT solutions, medical supplies, logistics contracts, and professional services.
Revenue Opportunities: Retail vs Public Procurement
Amazon Seller Revenue Dynamics On Amazon:
- Sellers earn revenue by selling products directly to consumers.
- Profit depends on pricing power, product margins, and cost management.
- Competitive pricing, advertising spend, returns, storage fees, and fulfilment charges significantly impact profitability.
- High-volume products can scale quickly, but competition is fierce and margins are thin in many categories.
For many low-ticket items, net margins for Amazon sellers can fall below 10% after accounting for fees and logistics costs. Larger sellers may capture more market share and negotiate better terms, but smaller sellers often find profits eroded by platform commissions, ad spend, and discounting.
GeM Seller Revenue Dynamics GeM revenue works differently:
- Sellers invoice government departments directly for fulfilment of purchase orders or contracts.
- There are fewer pure “price wars” compared to consumer marketplaces.
- Profit depends on contract value, delivery capability, technical compliance, and service reliability.
- Public procurement buyers focus on value, specifications, delivery timelines, and compliance - not just the lowest sticker price.
- Contracts on GeM can run into lakhs or crores per order, especially for services such as infrastructure maintenance, IT implementations, consultancy, facility management, manpower supply, logistics, or multi-year supply contracts.
MSEs and startups benefit from preference policies, including procurement targets, relaxed conditions, and various advantages that improve their chances in competition with larger players. Because government buying often involves large quantities, higher per-unit prices, and longer-term commitments, a successful GeM seller can earn significantly more revenue per order than a typical consumer e-commerce sale.
Profitability: Retail vs Procurement
When comparing profitability, the earning mechanics look very different.
Amazon Sellers
- Profit margins are highly variable by category.
- Smaller products may yield low margins but high turnover (volume-driven).
- Advertising, discounting, and fee structures heavily impact net profits.
- Most earnings depend on a volume × frequency game: many repeat consumer orders at relatively lower ticket sizes.
GeM Sellers
- Individual order and contract values tend to be much larger.
- Margins are negotiated based on contract value, service level agreements (SLAs), and delivery commitments.
- Government payments, while sometimes delayed, are backed by institutional buyers and formal contracts, giving higher overall reliability over time.
- Public procurement is less seasonal than retail marketplaces, offering more predictable B2G (business-to-government) demand.
- This combination makes GeM a strong channel for businesses that can handle compliance, documentation, and delivery at institutional scale.
Who Earns More?
Amazon Seller Advantages
- Massive consumer base with daily repeat buying.
- Ability to scale multiple SKUs across categories.
- Strong retail pricing leverage during festive seasons and sale events.
- Faster cash flow cycles for many categories, especially with Fulfilled by Amazon (FBA).
GeM Seller Advantages
- High-value contracts with government buyers (lakhs to crores per order).
- Less cut-throat price competition; more weight on technical compliance, quality, and service reliability.
- Scope for long-term rate contracts and recurring institutional orders.
- Higher per-order revenue due to institutional spending patterns.
- Policy support and preferences for MSMEs, startups, SC/ST, and women-led businesses, improving access and revenue share.
Conclusion
Amazon is excellent for brands that thrive on the retail model: large catalogues, daily sales, continuous visibility, and strong inventory, pricing, and advertising management.
GeM is ideal for businesses that prefer high-value institutional deals, bulk orders, predictable demand, and less cut-throat consumer pricing pressure - provided they can manage compliance and documentation.
In pure earning potential - especially per order, per contract, and even per financial year - well-prepared GeM sellers often outperform Amazon sellers by a wide margin, simply because public procurement economics naturally favour higher ticket sizes, long-term contracts, and more stable margins than typical consumer e-commerce.
For many Indian businesses, the real question is not Amazon vs GeM, but retail plus public procurement - using Amazon to build a consumer brand and GeM to lock in large, stable B2G revenue.