Building a Marketplace / Multi-Vendor Website in 3 Simple Steps

Building a Marketplace / Multi-Vendor Website in 3 Simple Steps

Did you know that the number of digital buyers globally is as high as 2.14 billion?

Your business could be tapping into this digital consumer base with ease: all you need to do is set up your own multi-vendor online store. The most popular multi-vendor sites that show up on search engine results may be Amazon and eBay; your business can also benefit from similar exposure online.

So, what is a multi-vendor marketplace? Much like Amazon, it is an online website that lets the sellers set up their “stalls” and sell their goods online. In return, the multi-vendor marketplace charges a commission for each sale to the sellers, and a fee for letting them use the platform to sell their items.

If you think this business model is right for you, read on.

To get started, you need to hire a WordPress web design company. The reason is simple: there are well over 12 million eCommerce stores online around the globe. To make a splash in this competitive market, you need a multi-vendor store that stands out. Receiving professional aid in building a multi-vendor marketplace online makes all the difference between a popular online store and an idle one.

3 Steps to Build a Marketplace

Most individuals in the world today own a mobile phone and use the internet. That makes them a likely consumer of your products. Given that internet penetration is high today, the necessity of building a multi-vendor marketplace is evident in consumer behavior that leans towards online shopping.

Let’s see how you can build a marketplace in three simple steps.

Identify Your Niche

Before you begin, you need to understand the kind of multi-vendor marketplace you wish to build. Consider the following examples:

  • Consumer goods, like Amazon
  • Dedicated consumer electronics, like Croma and Lotus
  • Freelancers, like Upwork and Fiverr
  • Skin and beauty, like Sephora

The basic idea is to narrow down your niche and strategize to create a multi-vendor marketplace that can deliver value to the customers. Just another “Amazon” would get lost in the crowd of similar platforms.

Thorough market research is needed. What are the consumers searching for? Do they need a dedicated marketplace to buy industrial machinery? Do they need an eCommerce store to purchase everything related to home improvement? Once you have the answer to what the consumers are leaning toward, you can begin to build your business case for a multi-vendor website that caters to these needs.

Remember: deliver something unique to stay relevant and stand out. This is important because, according to Similarweb, Amazon sold $62.9 billion worth of units in Home & Kitchen goods alone! If you have access to the right consumer insight, you could drastically improve your bottom line as well.

Build a Business Case

This is the most important aspect of launching your multi-vendor marketplace online. You need to get investors to fund the build, and for that you need a rock-solid business case that:

  • Clearly defines the problem
  • Offers a targeted, assured solution
  • Presents a revenue model

You can adopt a three-tiered approach to creating your business case, as discussed below.


A business case dwells on good research. It is imperative for you to know the customer segment that will benefit from your product, and what your value proposition would be to woo them. You need to work on the channels you would use to engage them (mobile apps or web-based apps), and who your key stakeholders are in all of this.

Once you have your research, you can move on to creating a business model.

Business Models

Horizontal and Vertical Business Models

A vertical business model deals with a single niche and includes a multitude of vendors, much like Sephora (that purely focuses on skin and beauty and includes countless vendors in the industry). On the other hand, a horizontal model includes multiple niches and vendors. A classic example is Amazon.

The Target-based Business Model

Answer this question: whom would you be selling to? There can be three possibilities:

  • D2C – When you are selling directly to consumers
  • B2B – When you are selling to other businesses
  • P2P – When your customers are the vendors and they sell to other customers (think Etsy)

Revenue Model

In the end, everything is for that bottom line. In order to get funding, you need to convince the investors through a robust revenue model that can assure the shortest possible duration to breakeven and then onwards to profits. You can explore the following revenue models:

  • Listing based
  • Featured product based
  • Subscription based
  • Commissions and advertising

Wireframing and Development

After proving your business case and receiving funding, the final building of your multi-vendor website can begin. You need to consider the following aspects and get professionals on board for the development:

  • Payments, compliances and legal
  • Designing and coding
  • Feature updates, versions, and overhauls

It is best to work with niche professionals because, for a large-scale multi-vendor marketplace, things can get complicated.


While it is extremely easy to actually build and launch a multi-vendor marketplace, the research and study that goes on behind it are what take up most of the time. Building your business case and revenue models is easy once you have the right data. Follow the guide above to create your own multi-vendor marketplace today.


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