Building a Multi-Vendor Marketplace

What is a multi-vendor e-Commerce and how it works

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

Online shoppers do not want to waste time searching through ten websites or more to find the item they want to buy.
Online shoppers want safe and secure answers that help them make quicker decisions and save time and effort.
The answer to this changing environment is the multi-vendor e-commerce marketplace just like Amazon and eBay.

Multi-vendor marketplaces are the ultimate answer for ecommerce marketers who are looking for new ways to enhance their shop and take it to the next level.

What is a Multi-vendor Marketplace?

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

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

The responsibility for the management of each shop lies with the different owners of the individual shops, while the main focus of stocking the products, delivering them to people's homes and accepting payments lies with those who run the multivendor.

Now think of this shopping centre as an online e-commerce. Your shopping centre becomes a marketplace, the small shops are the online shops of the sellers and you are responsible for order management, shipment management and payment collection.

How a multivendor e-commerce works

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

This is how a multi-seller marketplace works:

• Sellers register with the marketplace via paid or free registration.
• Once the seller registers and uploads his products, customers can start buying from him.
• 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.
• The delivery of the product is handled by the seller himself or also by the administrator.

Notification of defective products may be forwarded to the seller or also to the shop administrator, who supervises the seller's actions.

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

Here are the reasons for this change in the market:

• Variety of products
• Products sold in a multi-vendor are presented by a number of sellers.
• Any e-commerce shop 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 vendor, do you think they would be able to make as many sales as they do now?
• It eliminates most of the logistical problems such as taking care of deliveries, stock, product details and updates, prices and various other information provided.
• Running an online shop requires a lot of effort. The multi-vendor marketplace shifts these commitments onto the individual sellers.
• You spend less since each seller will manage their shop on their own, there is no need to hire resources to do so.
• You can invest more time in answering critical questions related to downsizing and marketing.
• Increased flexibility by allowing vendors on multi-vendor e-commerce platforms to manage product information, pricing and shipping areas and updates according to their requirements.
• Constant cash flow through 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 functionality

• The administrator can easily monitor and manage his 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 merketplace.
• The administrator can keep track of the total 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 get 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 offers to their customers.
• Sellers can request a category request to add more products within 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 popularity, but also help you increase your profits.

Integrate your Prestashop multi-vendor 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 which CMS they use.