Technology January 27, 2016 Last updated January 26th, 2016 2,613 Reads share

How is a Multivendor eCommerce Store Better Than a Regular Online Shop?

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Multi-vendor and regular eCommerce stores have few properties that make each of them suitable for certain audiences and sellers. There are multifarious features that increase the overall scale of a business as well as profits and make multi-seller platforms a better option than a single-seller store.

A Multivendor eCommerce Store is specifically for entrepreneurs who look at eCommerce as a potential business idea. Choosing it over a normal store makes sense to investors who do not want to take the pains of products selling but are keen to start an online business.

Let’s first learn about the basic difference between both stores. If you have to put it in one sentence, a regular eCommerce store has one seller and a multivendor store has many sellers. You can cite the difference below. The product page of a regular eCommerce store shows price and product details only, but the multivendor eCommerce website shows product, price and the seller’s name too for each item.

When and why should you build a regular eCommerce store?

  • Investing in a single-vendor eCommerce is apt for merchants/businesses that already sell offline. Bringing an offline brand online helps increase brand awareness as well as revenue sources.
  • Another instance of suitability of a non-multivendor store is when manufacturers selling their own goods want to make them available for online buyers too. They don’t need a store with multi-vendor features, a normal/regular eCommerce store with advanced features (CMS, responsive platform, online shopping cart, etc.)

Single-seller stores are owned and managed by one merchant only. The owner sells limited products and caters to a limited set of customers, which results in a limited scope of earning. Offering discounts and cheap prices is also not feasible, so attracting more shoppers becomes difficult at times.

When and why should you build a multivendor eCommerce store?

  • If you want to target larger audience than regular eCommerce stores and want a website that attracts millions of visitors, sells more products, earns voluminous profits, Multivendor is the solution.
  • If you want to start a profitable online business but do not like the idea of buying products, updating products catalogues on regular basis. Let the vendors do it for you and earn commission.
  • You can also choose Multi-vendor eCommerce when you know that certain markets lack a full-fledged online store and several small scale businesses exist out there. All you have to do is bring them together to sell through a common platform.

Multivendor is a good investment for new businesses

Why Multivendor is a good investment for new businesses

Not every offline business wants to take the pains of setting up a new website for selling products online. Selling through a multivendor ecommerce store attracts a merchant more than spending time and money on creating an eCommerce store from scratch.

As an alternative to starting an online business, a multi-vendor website scores a few more points than a regular eCommerce store owing to more earning opportunities. A Multivendor store runs on a bigger scale than a regular eCommerce site so the volume of sales is higher too.

More factors that favor multi-merchant eCommerce for starting a new online business are the following:

#1. One store – many vendors:

A multi-vendor system allows adding millions of merchants to one website. All of them can update their products on the store using the unique merchant ID and manage sales, offers, etc. on their own.

One store- Many vendors

#2. Sell more products

It is cumbersome for the owner of a single-seller store to assemble variety and a large volume of products to showcase on his site. On the contrary, stock added by various vendors makes it less painful for the site owner of a multi-vendor platform to target more customers and sell an array of products. Moreover single-seller stores usually showcase one type of goods, while a multi-vendor site showcases innumerable categories showcasing millions of products.

Multivendor Marketplace Sell more products

#3. Target many locations

The multi-vendor store has a bigger network than the regular eCommerce site and is able to target several locations together (even worldwide). Websites like eBay and Amazon are perfect examples.

#4. Enjoy More Footfall

Users love to do online shopping from the sites that have a huge selection of products. It gives them a solid reason to come back time and again to shop for things, which brings more traffic to a multi-vendor online store. A regular eCommerce website with limited products needs to focus heavily on search engine marketing to steal new visitors but a multi-vendor website already has the edge over small eCommerce websites in terms of footfall due to its large user base.

small ecommerce websites

#5. More Popularity

More people, more products, and more sales, (more social sharing, large network) all add up to more popularity of multi-vendor websites. Fame of Flipkart, Snapdeal and Walmart are the best examples. These sites have certain shopping influence that garners more fame.

more popularity of multi-vendor websites

#6. Greater scope

Study by Omer Rachamim and his team at Dandy Loop shows that approximately 12-24 million eCommerce stores are making money worldwide (as of 2015). And, multi-vendor stores are the frontrunners among them. There has been a significant increase in the total count of online shoppers as well as new eCommerce businesses in recent times, which points to a promising future of eCommerce.

#7. Cost-effective

There is not much difference in the cost of building a regular eCommerce store and the cost of setting-up a multi-vendor store; however, the latter offers more prospects to earn. By spending almost equal on a multi-vendor system, one can launch a site that can cater to wider audience, sell more products and offer manifold reasons to earn.

#8. More profits, Less bother

The website owner of a multivendor platform earns per transaction. His earnings are based on commission per transaction. He doesn’t require adding products and managing, as everything is handled by the associated vendor but the website owner nevertheless has authority to track sales, update store/product/price. He is given a password, which enables him to control the website completely through the admin dashboard.

multivendor platform earns per transaction

Ecommerce is an attractive business option but to make the most of this startup idea, try to ascertain first which market and revenue model can work best for you and how you will attain excellence in that industry.

To establish a profitable online venture based on a multivendor eCommerce store, acquaint yourself with emerging businesses of the world and ascertain the demand of chosen product or service in your target market. Creating a store using feature rich multi-vendor script should be your next step in order to compete with existing eCommerce brands.

BUSINESS TIP: Instead of looking for eCommerce store ideas, build a store targeting niche markets. It will help clearly define customer segment and cut down your time and efforts.

Images: Author’s Own


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Sandeep Thakur

Sandeep Thakur

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