Building a Multi-Vendor Marketplace

What is multivendor e-commerce and how does it work?

With the rapid growth of e-commerce in recent decades, trends are slowly shifting towards providing an increasingly personalised shopping experience for buyers.

Online shoppers don't want to waste time searching through ten or more websites to find the item they want to buy.
Online shoppers want clear and reliable answers that help them make quicker decisions and save time and effort.
The answer to this evolving environment is the multi-vendor e-commerce marketplace, just like Amazon and eBay.

Multi-vendor marketplaces are the ultimate answer for e-commerce marketing professionals who are looking for new ways to improve their shop and take it to the next level.

What is a multi-vendor marketplace?

As the name suggests, a multi-vendor marketplace or shop is a platform for third-party sellers who are given the opportunity to sell in one place alongside many other colleagues, with their own independent shop.

The idea is to create a large online shopping centre, a large shop that contains many small shops run by individual sellers.

The responsibility for managing each shop lies with the various owners of the individual shops, while the main focus of storing products, delivering them to people's homes and accepting payments lies with those who manage the multi-vendor.

Now imagine that this shopping centre is created with an online e-commerce platform. Your shopping centre becomes a marketplace, the small shops are the sellers' online shops, and you are responsible for managing orders, managing shipments and collecting payments.

How a multivendor e-commerce site works

A multivendor online shop operates efficiently and effectively thanks to the shop owners and suppliers. It is necessary to maintain direct communication and keep customers updated on various offers, as well as ensuring that the product is delivered on time.

Here's how a multi-vendor marketplace works:

• Sellers register with the marketplace through paid or free registration.
• Once the seller registers and uploads their products, customers can start buying from them.
• The multi-vendor administrator may charge a small commission on each transaction.
• Most payments are transferred to the shop administrator and from there to the chosen seller.
• Product delivery is handled by the seller themselves or even by the administrator.

Communication about defective products can be forwarded to the seller or even to the shop administrator, who supervises the seller's operations.

Why are more and more digital store owners switching from e-commerce to a multi-vendor platform?

Here are the reasons for this market shift:

• Product variety
• The products sold on a multi-vendor platform are presented by a number of sellers.
• Any e-commerce store that offers a huge variety of products is bound to easily attract more traffic and sales.
• If eBay, Amazon or Etsy handled all products from a single supplier, do you think they would be able to make as many sales as they do now?
• It eliminates most logistical issues such as taking care of deliveries, stock, product details and updates, pricing, and various other information provided.
• Running an online shop takes a lot of work. A multi-vendor marketplace shifts these responsibilities to individual sellers.
• Lower expenses because each seller will manage their own shop on their own, so there is no need to hire resources to do so.
• You can invest more time in answering critical questions related to scaling and marketing.
• Greater flexibility by allowing suppliers on multi-vendor e-commerce platforms to manage product information, prices, shipping areas and updates according to their requirements.
• Steady cash flow thanks to commissions, as any multi-vendor marketplace can have an infinite number of sellers and earn money by taking a commission on every transaction between sellers and customers.

Administration features

• The administrator can easily monitor and manage their sellers.
• The administrator can charge a commission from sellers.
• The administrator can add a separate registration section for sellers, so that they can easily register on the marketplace.
• The administrator can track the overall transactions of sellers from the back-end interface.
• The administrator can approve or reject products added by sellers.
• The administrator can also approve or reject requests to add new categories submitted by sellers.

Seller features

• Sellers can access an interactive seller dashboard.
• Sellers can easily monitor their earnings.
• Sellers can link their social accounts to their marketplace profile.
• Sellers can add coupons to their shop to offer attractive deals to their customers.
• Sellers can submit a category request to add more products to the marketplace.

Examples of different multi-vendor marketplaces

Thanks to Cuborio, we can provide various extensions that help you convert your e-commerce shop into a fully functional multi-vendor marketplace.

These extensions not only help you increase your popularity, but also help increase your profits.

Integrate your multi-vendor Prestashop by creating your own marketplace, allowing multiple sellers to sell their products.
Integrate your multi-vendor Opencart by easily transforming your single-vendor site into a fully functional marketplace.
Integrate your Magento 2 multi-vendor by helping Magento 2 shop owners create their own marketplace regardless of the CMS they use.