Just like the sky is not the limit, an online store is not the final stairway to your e-commerce business. When eBay started in 1995 and picked up growth, entrepreneurs started thinking that maybe an online marketplace is an answer to limitless e-commerce growth. And guess what? It indeed is!
The e-commerce wave has helped e-tailers and even B2B businesses in a big way. It has made shopping convenient and fun. But it sets forward challenges of its own. The restrictions of limited inventory and inadequate choices for customers makes it rank number 2 after multi-seller online stores.
Why do you think Flipkart, Amazon, Snapdeal and many others are not just online stores but multi-vendor stores? There have to be some perks right? And why do you think Multi-vendor marketplaces hold tremendous potential? Is it because of the vendors that indirectly contribute to drive huge traffic and sell more products or is it because customers get a greater variety and price benefit? Or maybe it is because of both these factors! Food for thought, isn't it?
What is a multi-seller online store?
Remember those local fairs where different sellers used to put up their stalls? Back then, these sellers paid a lot of money to acquire a small space. Why? Because they not only got undivided attention from people who visited the fair but their brand also got decent exposure.
An Online marketplace runs on the same principle. The admin of the multi-vendor store invites different merchants (of one or different categories) to sell their products in one place. This makes it a unique point of connection between vendors and customers.
Because of multiple listings, customers get to browse through an endless inventory and vendors get the benefit of brand awareness. Moreover, the admin earns commission upon every sale.
Now since a Multi-seller online store offers several benefits to the three parties involved, i.e. the owner, the vendors and the customers, can we say that it is a win-all model for all? Let's look at these aspects in detail.
A multi vendor marketplace is like an owner’s chicken giving golden eggs
- As the owner, you get complete control over your vendor activities. You can choose vendors and approve products before they get uploaded on their individual storefronts. Through a centralised process, you can monitor vendor sales, check out performances and manage respective ledgers. During sign-up, you can also get them to sign on specific terms and conditions that are in favour of customer protection and helps in running a smooth business.
- What comes to mind when one talks about an online marketplace? An extensive inventory, of course! Greater the inventory, greater the hassle to manage it, maintain stock, etc. But here, Inventory management is vendors' responsibility and not yours as the admin. The platform through which you build your multi-seller model should provide vendors the feature to manage their inventory as per their liking.
- Why did we say that a multi-selling online store is like a chicken giving you golden eggs? Because once you set it up and invite vendors to list their products, your role is over. Then all you need to do is manage the storefronts, look after the maintenance of your multi vendor marketplace and run marketing campaigns to drive traffic. Depending upon the commission plan you have agreed, you can get the benefit of a fixed or flexible commission upon every sale your vendors make.
- When you are running a web store, you not only have to manage the inventory but also take care of order uploads, product upgrades and most importantly, Logistics. In the long run, these tasks could be a little daunting. In a multi-selling set-up, all this will be taken care of by the vendors. Yet this does not mean you do not have a say in this at all! As the admin of the online marketplace, you have the flexibility to integrate your vendors with carriers and offer free shipping to customers. You can also work out different deals and run promotions through vendor partnerships and drive more traffic to their storefronts.
- Nowadays, nobody goes for conventional setups. Relying on top e-commerce software is the better way to build a scalable model. This way, you get in-built features for easier business management and future-ready automation for implementing your own ideas for expansion, modifications, etc. StoreHippo, a modern-day e-commerce platform offers out-of-the-box solutions to help you set up a multi vendor marketplace quickly. Its battle-tested features give you a futuristic model to achieve maximum profitability. Hence, with top e-commerce software, you can build a fully-functional model without the need for any technical knowledge.
The multi-seller online store is the fertile soil for vendors to establish a flourishing business
- If vendors were to create their own websites to take their business online, it would cost them a fortune. Not literally! But for small and budding sellers, this means a huge set-up cost. A multi vendor marketplace is a well-suited platform for vendors who want to step into the e-commerce market at zero or minimal cost. Even if merchants already have a website, this is an ideal, dynamic and cost-effective solution for an additional sales channel. Similarly, vendors running only brick-and-mortar stores can quickly find another opportunity to give their business more exposure.
- An established multi-store model holds a lot of potential to attract customers, giving vendors more sales opportunities. Even if vendors came up with their respective web stores, it would require them to pour a lot of time, effort and capital before they witnessed site traffic. After all, how much inventory can a single seller offer against the variety of options at an online marketplace?
- Just like managing inventory, products, shipping, etc. is vendors’ headache, running Marketing campaigns come under admin responsibility. Another added advantage that vendors have in terms of cost, is that they don’t have to spend a dime behind marketing and advertising. All the brand-building efforts are done by the owner and the vendors get to reap its benefits in terms of more customers at their storefronts.
- Running an online business requires superior Technology and the right kind of software solution. This is also one reason entrepreneurs shy away from online stores. However, a multi vendor marketplace built using the right software helps them to get carefree and focus on sales. Vendors do not have to worry about the technical aspects of site maintenance, glitches, etc. All this can be taken care of by the admin.
- Sellers can manage product details, prices, make additions and updates to their inventory as per their convenience. A multi-selling model offers them this flexibility negating the need for any technical expertise. More so, unlike online stores where sellers are stuck with dead-stock, an online multi-seller stores gives them the freedom to test buyer acceptance for new products. Saying so, vendors float in a zero-risk zone!
An online marketplace is customer’s genie to fulfil their shopping wishes
- A multi-selling store means there are several sellers and customers get different options to choose from. Suppose you wanted to buy a fine piece of Jewellery online. If you went to a web store, chances were that you might get confined with limited choices. You might have to visit several online stores and browse through their product categories before you finally get something you want. Against this, a multi-vendor online store offers you multiple storefronts. You can hop from one vendor to another till you are satisfied. Besides you can browse through a rich product catalogue under one roof.
- A multi vendor marketplace is a fierce battle-ground for vendors. Each vendor wants to earn more sales and become a top-performer. This competition benefits customers in terms of Pricing. To lure customers, merchants often keep low margins and focus more on volume. Besides, they also offer deals, discounts, etc. Customers not only benefit from competent prices but also get complimentary benefits due to large scale operations of multi-seller models.
- Suppose you go to Amazon to buy groceries, footwear and some sports gear. Will different vendors raise separate bills and does it require you to pay separately? Of course not, right? This is another added advantage that customers get at an online marketplace. They can buy multiple products, brands, etc. in a single order.
- A multi-vendor store has vendors’ credibility at stake. Also, disappointing one customer means spreading the word out and affecting overall sales too. So in the case of multi-selling models, owners put in a lot of effort to sustain their market reputation and please their customers. High-quality vendors, streamlined Logistics, customer protection policies, etc. make buyers feel that they are dealing with a genuine brand. This creates a sense of trust and loyalty among customers.
A multi-vendor marketplace is a win-all business model
A multi-seller online store offers specific perks to the admin, the merchants and the customers. No wonder experts predict that by the end of 2020, 40% of all online shopping will happen here. Major household names are thriving with millions of active listings and customers. The revenue they generate is exhilarating!
While you might not think of those staggering figures right away, you need to start somewhere to create your online marketplace.
What’s the best way to start? We recommend you to first find a reliable E-commerce solution. StoreHippo is an all-round e-commerce platform that is much like your business partner if you want a successful and scalable model. StoreHippo provides you;
- Hundreds of ready-made themes to create customer-winning storefronts
- Mobile-first approach with an excellent user interface
- Stores that are PWAs
- Advanced features to compartmentalize vendor pages, product management, inventory and seller ledgers
- Marketing tools and discount engines to attract customers
- Unified notifications
- Integrated logistics through its shipping aggregator platform, ShipKaro
A multi vendor marketplace is the next-gen shopping destination in the coming times. Get ready to step foot into the e-commerce game with a reputed market player. Get our 14-day exclusive free demo trial store or ask more about our feature-rich platform by getting in touch with at firstname.lastname@example.org!