2 Factors of selling products on a marketplace for profit

By alirajpout110@gmail.com

April 3, 2025

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2 Factors of selling products on a marketplace for profit

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A better price per unit is guaranteed when purchasing goods in bulk. This fact implies that in order to increase its profit margin, a corporation may choose to import goods in bigger quantities than it had originally intended. When faced with an overstock, some businesses choose to sell their goods in a marketplace since they didn’t take into account the sales potential of their commercial channels.

In contrast to our own e-commerce, these technical sales platforms, which receive hundreds or even millions of visitors daily, offer a lot of promise. However, concurrent product sales on both platforms are not incompatible. Before choosing to offer our items on this kind of online marketplace, a careful evaluation of the benefits and drawbacks will be essential.

Despite the fact that marketplaces were first developed for professional or business-to-business (B2B) purposes, the growth of e-commerce over the past ten years has made some of these shopping websites the most well-known in the world. These days, Amazon, AliExpress, and eBay are without a doubt the most well-known instances of marketplaces. Every day, thousands of individuals visit these e-commerce sites to purchase a wide range of goods.

Advantages

Before establishing their own website, many businesses first sold their goods on marketplaces. Indeed, there have been instances of genuinely extraordinary sales, like the company that sold an express cooker on Amazon.com for $14 million in a single day.

Placing our catalog on a third-party website has several clear benefits, including as

Starting investment

Not having to invest in your online store is one of the key benefits of selling in a marketplace. As a result, there is no need for a designer, technical upkeep, or domain or hosting fees. This implies that you can begin selling without making any financial commitments.

High volume of visits and no need for advertising.

These websites have become well-known due to the growth of the marketplace, and as a result, thousands of people visit them daily. For instance, advertising is a totally needless expense on Amazon.com, which receives 200 million unique visits each month.

Trust in the brand

As seen by the previous statement, regular marketplace users have such a high level of trust in these platforms that they don’t require any vendor information.

Logistics

One of marketplaces’ key selling factors and a major asset is their shipping and logistics. In a short period of time, several of these platforms provide “free shipping.” In some circumstances, this can potentially happen in two hours on thousands of products. This is made possible by the fact that these online marketplaces allow vendors to store their goods in the warehouses, enabling quick and effective shipping.

As we can see, the benefits are so great that some businesses decide to use markets as their sole sales channel. This choice logically has certain drawbacks as well.

Disadvantages

Some businesses think that selling their goods on a marketplace is like “selling your soul to the Devil.” While this is obviously untrue, it’s nevertheless vital to understand that online sales platforms have drawbacks, especially in the medium and long run.

Competition and price wars

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Lack of freedom in markets is one of the biggest issues that businesses frequently deal with. Despite having the freedom to set your own prices, you must do so in order to sell because there are tens, hundreds, or thousands of other vendors offering the same goods.

Your customers are not your customers

The buyer thinks they purchased from the marketplace rather than the vendor, even if they choose more conventional logistics options where the business ships the goods straight to the customer. A business finds it extremely challenging to foster customer loyalty or execute follow-up marketing initiatives as a result.

Great difficulty in building a brand

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Relying too much on the marketplace prevents sellers from effectively building their own brand, something that businesses frequently lament when they begin to generate a sizable amount of sales and wish to transition to their own commercial channel.

High commissions

Two factors often determine the cost of selling in marketplaces. First, a predetermined monthly fee that is reasonably priced; second, a substantial commission on the sold goods. Despite the volume-related benefits of marketplace selling, profitability can also be much lower. As import specialists, we must keep in mind that purchasing in bulk is not the only option if we want to purchase goods at a lower unit cost. A sourcing company’s assistance guarantees that we may negotiate a lower price for our goods and maximize the overall.

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