Multi-Vendor Marketplace Explained

Posted by on January 5, 2016

Understanding Multi-Vendor Marketplace

Huge e-commerce portals like Amazon and eBay are some good examples of a multi-vendor marketplace. There are multiple sellers selling their products in these marketplaces and hence the name! These marketplaces are receiving loads of traffic and selling through them is the simplest way to expand your online business. Yes, you can also create your own multi-vendor marketplace if you wish to, however I would recommend you to built it in a niche area. It is a platform where the multiple sellers list their products for selling it online. These kinds of marketplaces enable the vendors to create their online store to sell it to the customers from worldwide. There is growing economy and continuous demand for these multi vendor marketplaces. According to the recent statistics, USA remains second in the eCommerce market of about $349.06B. Interesting data in the US marketplaces is that only 28% of small businesses are selling product online. There is still a much space for new entrepreneurs in the online marketplaces. You can start your own multi-vendor marketplace in an easier way by creating a marketplace website. Instead of developing it from the scratch, you can make use of the ready made scripts. Have a look at the demand for the online marketplaces in different countries through this info-graphics: multi-vendor marketplace demand It is a platform which enables their vendors to add and edit their products, manage inventory, interact with customers, manage their accounts and fulfill orders - all within intuitive and easy to use Vendor Portal. Here different sellers can add their different products as per their choice and the requirement of the market. It is a huge platform which proves to be beneficial for the start ups to sell their products within a website owned by others. This gives them a platform to advertise their inventories in front of their targeted audience. multi-vendor marketplace chart I have divided the multi-vendor topic in four categories as follows:
  1. Dropshipping Marketplace - This is kind of most used marketplace system where your vendor don't need to have an inventory/stock of the product  and purchased item will be shipped from directly to warehouse . Lots of Small and Mid-scale vendors/sellers use such kind of marketplace.
  2. Price comparison Marketplace Or Multiple Seller Same product marketplace This is also another kind of marketplace which can be associated with drop-shipping marketplace .The main and most important part associated with it will be price comparison among sellers so lets say there are 3 sellers A , B , C and all three are selling the same Items Product "P" in this case such kind of marketplace are quite useful .
  3. Single Cart Multi vendor / Seller Marketplace Most of the e-commerce shop in the internet are single cart system even some of the popular e-commerce marketplace are single cart . Single cart means where there checkout will take place at once that means lets say you have three sellers a , b ,c  and if buyer "B" is purchaing the product from all the sellers in this case still only one checkout will take place and payment and order information will be split by admin or by post order process management .
  4. Multi Cart Multi vendor / Seller marketplace This is quite unique kind of marketplace system where cart will be split as per the vendor so lets say you have 4 sellers then in this case 4 checkouts will take place.
Difference between e-Commerce Store and Multi-Vendor Marketplace e-Commerce Store • Only store owner and buyers are involved • Only store owner can sell goods to buyers • Only Admin can add and manage goods • Admin collects revenues from direct sales of goods Multi-Vendor Marketplace • Store owner, sellers and buyers are involved • Both sellers and store owner can sell goods to buyers • Both sellers and admin can add and manage goods • Admin collects revenues from direct sales and also earns commissions from the sales of sellers. If you have any specific questions, then please write in the comments. I will answer soon.
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  1. Daljeet Kaur
    January 27, 2016

    Shishir, Thanks for sharing information about multi vendor marketplaces. Multi vendor online stores are becoming good source for eCommerce startups who started their online stores recently. The main benefit of launching multi vendor store is admin need not to be worried about online store sales alone. As multiple products get added by multiple vendors keeps online stores working in the form of traffic and sales. Moreover, online store owners can earn extra money in the form of commission from vendors on every product they sell.

    Moreover, getting started with multi vendor website is easy as compare to others.

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