Learn to build a multi vendor marketplace
How To Build A Multi-Vendor Marketplace Website?

How To Build A Multi-Vendor Marketplace Website?


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Multi vendor marketplaces are fulfilling the changing needs of buyers as well as sellers. To build multivendor marketplace, you need to first understand how these are redefining the way people shop online. Amazon, eBay, AliExpress, and Walmart are among the top players that make the highest online sales globally. This blog talks about all the details to create a multi vendor marketplace.

What Is A Multi-vendor Marketplace?

A multi-vendor marketplace is an extensive ecommerce platform that offers products and services from more than one seller. It consists of all the functionalities that complete the buyer’s journey, such as – product discovery, online ordering, shipping and payments, review and ratings, etc.

To build multi vendor marketplace, all the above functionalities will be added to the online store. It is a one-stop shop where one can find different products from vendors, shops, or people showcased on the same platform.

The marketplace owner will create multi vendor marketplace website and is responsible for attracting customers and processing transactions. The third-party vendors only deal with keeping their products updated and in stock.

Demand for online marketplaces

A report from 2021 indicates that 9 out top 10 US retail ecommerce companies are marketplace platforms and make the highest revenue.

Top 10 references to create a multi vendor marketplace 

It is now a globally accepted fact that the overall experience on a marketplace is far more superior than an individual website. This is also evident by the fact that marketplaces contribute 47% of all the digital purchases worldwide. Further on this, the revenue from marketplace platforms more than doubled from 2017 to 2022.

Types of multivendor marketplaces

    • B2B Marketplace: It is the fastest growing industry when it comes to marketplace models. A business-to-business marketplace is one where product and service transactions only happen between Businesses. For Eg. Alibaba.
    • B2C Marketplace: Business to Consumer marketplace is a platform for retail transactions directly with consumers. They concentrate on pitching to people and marketing their items for individual consumption. For Eg. Starbucks
    • B2B2C Marketplace: As the name suggests, these cater to both B2B and B2C transactions. Furthermore, consumers or even other businesses can make purchases from the online store of a business entity. For example, Amazon
    • C2C Marketplace: It is a type of marketplace in which product and service transactions happen between customers. The main focus of this marketplace is to build a healthy relationship between buyer and seller to find each other. E.g., eBay
    • P2P Marketplace: The peer-to-peer marketplace brings together users who offer products and services offline. In this, the buyer and seller directly communicate with each other. E.g. Etsy

Read this innovative story of ExpressGrass marketplace based out of the US and UK to get your inspiration.

Types of revenue models in a marketplace

The owner of the marketplace has multiple methods of income from this platform. It can be rightly said that build multi vendor marketplace to earn good and grow well. Some of the revenue streams are:

  • Commission fee: The marketplace owner can charge a commission fee on every transaction of the vendor listed on its platform. This can be in the form of a flat rate or a percentage share of the transaction amount.
  • Listing fee: E-commerce websites for sales and exchanges, typically have a fee for its vendors, known as Posting or Listing Charge. The listing charges is generally based on the value of the products and the number of days it is to be displayed. For e.g., Etsy charges a fee for listing your product.
  • Account fee: Some e-commerce websites charge this fee for registering and opening your account on their website for selling products. For example, Sears Charges $40 to open an account.
  • Fulfillment Center fee: It is the fees that are paid for the products which are in the warehouse for shipping. This fee is paid for spacing your product takes in the warehouse. Every e-commerce marketplace charges it.
why build multi vendor marketplace

A well-researched and designed marketplace model can easily receive funding from external sources.

Benefits of multivendor marketplaces

Build multi vendor marketplace and it will by default offer a plethora of benefits for all of its stakeholders. To simplify this further, we have listed below some of these with a focus on all groups.

For store owner

It is a wise decision for entrepreneurs to create a multi vendor marketplace website in place of a single seller store. This is so because of the numerous advantages that come along with these platforms. Let us look at a few:

  • Low investment high return business model
  • Diversified stream of income with lower financial risk
  • Transparent supply chain with streamlined processes
  • Improved customer experience with more variety

For sellers

Marketplace platforms are very convenient for sellers, specially the smaller ones, who do not have any digital presence yet. Some benefits include:

  • Easy to add new markets and test a new market
  • Limited investment to access a wider audience
  • Efficient way to expand business and sell across borders
  • Reduced overhead expenses on maintenance and technology

For buyers

Buyers form the key consumers of marketplace platforms. Marketplaces provide them multiple options at every stage to choose from. Let’s look at some of these benefits:

  • Access wide range of product varieties from different sellers
  • Multiple and flexible choices to makes payments
  • Easy to make comparisons between available options
  • Standardized and reliable processes for returns and refunds

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Approach to build multi vendor marketplace

To create a multi vendor marketplace, the most important aspect lies in deciding its functionalities. More so because it is a platform where multiple users will experience and access what your business has to offer for them.

For the consumers, it needs to help them discover, choose, purchase and return. For the sellers adding and selling products should be a smooth ride. And lastly build multi vendor marketplace that keeps the store owner at the top of all these actions and more.

Must-have capabilities

  • Admin controls – to manage all the user activities on the platform, track and measure the business performance through individual contributions
  • Insightful reports – to precisely connect with the consumers and fill in nay gaps that can further improve the engagement and revenue Ease of experience – for its users, i.e vendors and consumers, to navigate the platform smoothly and perform their respective actions
  • Smooth checkout – a single-page checkout helps to avoid any last-minute friction that is the final deciding factor for a successful conversion to happen
  • Mobile optimized – for an uninterrupted access of all the products and services on smartphones
  • Vendor actions – that allow the vendor to manage its account and orders in the best possible ways
  • Flexible payment methods – for providing convenience to the consumers with different credit options
  • Shipping solutions – to help orders reach the right person at the right time worldwide

Create a multi vendor marketplace with CedCommerce

7 steps to create a multi vendor marketplace

A step by step approach to build multi vendor marketplace is given below. Follow the right sequence to avoid any complications and set up a fully featured website for your business.

  1. Identify the product niche and define exactly what products or services your business would offer. For example, luxury accessories, electronics marketplace, grocery supplies, or any other niche that you shortlist based on your market research
  2. After the product niche, understand who your audience is. This should ideally include the age group, location, designations and other details that help you connect more closely with the target groups.
  3. Now to proceed further, you need to specify whether your business should be based on a B2B, B2C, B2B2C or any other model depending on the target groups and the product niche. Along with this also define the revenue strategy here at this step.
  4. Now comes the development related part. So choose a domain name, hosting, a multi vendor platform and the solution that goes with it. All of these are the basic requirements that will east the development process and ensure all your basics are sorted.
  5. Once the platform is selected, make the choice of configurations that align with your business objectives. In case you need any additional functionality then choose the appropriate extension or add on based on your solution partner’s suggestion.
  6. Test run the site that has been set up and check how it is performing before you launch it for your audience.
  7. The final stage is here. It’s time to make your marketplace app go live! Launch and begin the promotions that can make your launch a success.

Methods to build a marketplace

There are various methods to create a multi vendor marketplace. Specific business requirements can help to choose the ideal one. While some businesses prefer to build the entire storefront from scratch, others need a faster closure on this.

stages of building an online marketplace

Below are the ways to build multi vendor marketplace website :-

1. Extensions for existing websites:

Single seller stores can be easily converted to marketplace websites by using extensions. These help to add all the features that are needed for adding vendors on your existing website. This method takes lesser development time while providing exceptional features for vendor management.

2. Build a marketplace from scratch:

This method is more accurate for bigger businesses that are focused more on maintaining their brand values and getting their exact expectation built on their online stores. Though the development will take longer than the earlier method, the output will be far more customized. This may also mean a more dedicated maintenance and support on an ongoing basis.

3. Choose a pre-built marketplace solution:

Plug and play solutions are also available for different industries that are designed to achieve excellent support for adding vendors. Industry-based businesses can choose amongst different available solutions. 

Before we dive into the marketplace solutions from CedCommerce, click on the link below to explore the enterprise marketplace guide. The guide is your all-in-one resource to learn the benefits, key challenges, strategic direction for a successful launch, must-have features of an enterprise marketplace, and more.

Download the Free Guide

CedCommerce marketplace solution

CedCommerce offers an extensive range of features for merchants and businesses to deploy the most advanced level of marketplace websites and mobile apps. The most popular and widely accepted solutions are the marketplace extensions that have helped thousands of businesses grow into a marketplace. These are further available in two versions:

Marketplace Platinum Package:

Designed for mid to large sized businesses, some of the most liked features this package are:

  • Unlimited products and vendors
  • Simple, downloadable, virtual, configurable, bundled, grouped product types
  • Order management for vendors and admin
  • Different types of commissions for admin
  • Social logins for vendors and customers

Find complete list of features with details about the Marketplace Platinum Package by CedCommerce here. 

Marketplace Advance Package:

It is a superior solution suitable for big sized businesses focused on getting advanced level controls on their marketplace websites. It includes all the features of the above package and:

  • Support tickets for resolution of client queries
  • Bulk Import/Export options for vendors
  • Price comparison from different vendors
  • Split payments methods
  • Return options for products
  • SMS notifications for vendor activities

Find complete list of features with details about the Marketplace Advance Package by CedCommerce here.


As we all know, building a Marketplace is not easy, but with the right planning and acquisition of that plan, you can achieve great heights in that field. CedCommerce provides you support in Creating Multi-vendor Marketplace. If you want to make your dream come true, we provide you a multi-vendor marketplace open source script with non-encryption. You can also easily customize all features and products.

Learn more about creating an online marketplace from CedCommerce experts

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