1. What are the key strengths of the marketplace
Before taking their business online, it is important for the entrepreneurs to gain in-depth information about the strengths of the marketplace of their choice. The business owners need to understand that no marketplace can sell all types of products to the target audiences with equal success, irrespective of what claims they might make.
While some marketplaces might have a better stronghold in selling low value items, others might be more suitable for selling bulk products or industrial grade items. It is also important for the entrepreneurs to have a clear idea about the reach of the marketplace as well as its stability and working policies to avoid losing good business opportunities.
In addition to get the necessary details, entrepreneurs should not only verify the truth of the claims made by e-commerce websites shortlisted by them but also conduct a through online research on their own.
2. Level and strength of competitors
When choosing an online marketplace, business owners need to pay special attention to the level of and strength of their competitors. Most e-commerce websites use multiple suppliers under within a single category to ensure a better and wider choice for their clients.
Entrepreneurs need to carry out a complete analysis of not only the popularity of their competitors amongst clients but also their level of quality, pricing policy and even their market goodwill. This is true not only in case of new businesses trying to create a niche in their chosen field but established brands seeing an entry into the virtual marketplace.
Having a clear idea about the type actual position and strength of their competitors can help the business owners devise strategies to counter the same.
3. Getting a detailed and attractive catalog built
Presenting the products and services being offered in an informative and attractive manner is one of the most important aspects of ensuring success in the online marketplace. Sellers need to understand that the unlike in the physical stores, online shoppers are deeply influenced by the manner in which a product or service is presented to them.
As such creating an attractive catalogue that provides a multidimensional view of every product along with all the basic details such as the size, price, availability is of critical importance. It is also a good idea to have a separate information sheet for each product that contains all the above details plus a brief description of the product, color choices available and shipment details, for attracting customers.
4. Merchant Support Service
Before going ahead with selling their products on a virtual marketplace of their choice, it is important for the sellers to get detailed information about the kind of merchant support service they will be getting. The business owners need to make sure that the marketplace has a well defined policy in place to help the sellers generate better sales for their products.
Most such websites even have a merchant support team consisting of experienced market consultants and other professionals, who work in close coordination with individual sellers to ensure that their products get featured in the marketing campaigns of the marketplace. The sellers also need to make sure that their merchant account managers understand their products and the target audiences so that they can devise result oriented policies for better results.
5. System Access and Control
Entrepreneurs need to prepare themselves to face the restrictions that are integral to selling their goods through an online marketplace as compared to setting up their own website, in which case they have a greater control.
However, the sellers should acquaint themselves with the administration systems that the marketplace offers them for use. They should learn about the house rules of the marketplace including the maximum or minimum number of listings allowed, the freedom to promote their band using social media channels, restrictions on selling in specific regions and the access provided to customer data.
6. Margin, Fees, and ROI
There might be several reasons for sellers to join established marketplaces online including the need to expand their market reach or increasing sales value. The sellers need to understand the fact that the virtual marketplace they choose cannot be used for lead generation or acquiring a greater market share.
In fact, almost every virtual marketplace will charge a set margin or every sale value from the sellers for goods sold through the website. In addition the sellers should be prepared to shell out extra charges in the form of annual fee, shipment fee and listing fee etc. However, in case the sellers feel that their sale margin and market goodwill has enhanced by a significant percentage, then they should not worry about paying the fee and other charges to get a good ROI.
7. Shipping Mechanism
Often the shipping mechanism differs with individual e-commerce websites as while some marketplaces handle the responsibility of shipping the products to the clients on their own, others might defer this task to the sellers.
In case of the former set up, the sellers might be required to pay a nominal fee to the marketplace for this service. Alternately, the websites might even add the shipping charges to the price of the products, with or without the knowledge of the customers, in which case the price might become slightly higher.
8. Payment Mechanism
Timely and honest payments are critical for the success of any kind of partnership between a marketplace and sellers. The sellers should be extremely clear about how often and when they will be receiving the payment for the sold products.
It should also be made clear by the marketplaces about whether the fees and margins for each sale payable to them by the sellers would be deducted from the sale value or would be paid separately by sellers at the end of a specific time period.
9. Returns and Refunds
The return and refund policies supported by the marketplace also need to be considered by the sellers before bringing their products online.
Most virtual marketplaces have a uniform return and refund policy for all suppliers, which make it necessary for the sellers to take back any defected products and refund the sale amount after deducting the shipping and handling charges.
10. Dispute resolution process
It is extremely critical for the sellers to be aware of the dispute resolution policy followed by the virtual marketplaces. Generally, the marketplaces require the sellers to sign a contract detailing all the terms of the partnership and the method of handling any disputes.