Building a Marketplace on your own vs. with Expert Assistance – Benefits, and Drawbacks of Approaches

Marketplace – a tool for scaling your business

Modern businesses are eagerly embracing marketplaces as a means to expand their sales channels by creating online stores. If you already have a website, you can expand your business by turning it into a similar platform, allowing you to onboard other sellers and attract a broader customer base. In this business model, your website visitors will buy goods from multiple stores within your platform, which lets you generate additional income.

Another strategy is also possible when an entrepreneur decides to build a business from scratch and builds a marketplace. In this approach, the platform owner does not sell their products but instead provides services to sellers to open online stores.

Marketplaces are classified based on various criteria, including business models, types of participant interactions, product types, and more. For example, platforms can be monetized through:

• commission: for transactions, sales, and others;
• premium access;
• charging fees for each product listing in the catalog;
• lead fees;
• ads;
• supplementary services;
• a mixed business model.

For instance, eBay generates revenue through sales commissions, just as currently popular NFT marketplaces – digital platforms where people store, buy, and sell digital goods. Facebook Marketplace monetizes its platform through advertising, Amazon earns from supplementary services, and Shopify derives income from premium access and sales commissions.

In 2019, FreshTech assisted the Kazakhstani investment and construction holding BI Group in creating a marketplace called Smart Remarket, which curates offerings from suppliers of products and services for home repairs and renovations. The client's goal was to transform the complex and confusing process of renovation into a comfortable and pleasant activity, while also creating a convenient and beneficial service for people. Our team developed a solution to this request, and delivered the following outcomes to the client:

• a large product catalog that can be easily updated and adjusted as needed.
• structured multi-level menu with categories and subcategories, along with a convenient search system featuring suggestions and advanced product filtering options;
• a personal account where users can conveniently access and manage personal data, track order history and statuses, connect payment cards, monitor bonus account status and transaction details, as well as review all financial operations;
• a unique bonus system based on cashback rewards for each purchase, that can be used to fully or partially pay for new orders.

How do I build a marketplace?

Entrepreneurs typically opt for one of three approaches when it comes to marketplace development:

• creating a marketplace independently using a website builder,
• hiring an in-house specialist,
• seeking assistance from an expert team.

However, each approach has its benefits and drawbacks. To delve deeper into this matter, we suggest using a comparative table to analyze the three approaches in more detail.

The choice is up to you, but we have an interesting case study for your consideration. Agroapp, a Ukrainian company, approached FreshTech to develop an online platform aimed at facilitating and streamlining the lending process for agribusinesses. The aim was to ensure the quick and effective processing of applications while maximizing managers' productivity. Accordingly, our experts put great emphasis on developing user-friendly and functional personal accounts, leveraging the latest trends in user interface design. Additionally, we devised a distinctive logic to tackle the challenging goal of uniting agricultural producers, suppliers, and financial institutions within a single platform. With innovative IT solutions, Agroapp empowers its users with the following benefits:

• applying for a loan in a few simple steps –an agribusiness only has to provide their Legal Entity Identifier and the desired loan amount;
• the application is sent to partner banks in a few minutes;
• agricultural producers no longer have to spend weeks submitting documents to financial institutions, as the platform collects data about their farms from over 70 open registries and automatically includes it in the application;
• Agroapp introduces a revolutionary approach to agricultural financing by processing loan applications through an auction-based system, where the country's major banks compete for potential borrowers.

When creating a marketplace, proper consideration of legal aspects is crucial. This ensures effective communication with users and reduces the burden of repetitive questions. You should consider creating the following set of documents:

• privacy policy;
• accounts terms of use;
• description of services provided to different types of users
• payment terms;
• selling on marketplace guidelines;
• platform liability limitations.

While working independently, you are responsible for resolving all these issues on your own. However, when you engage specialists, the team takes care of everything necessary for the platform to operate efficiently.

How do I create an effective B2C or B2B marketplace?

Entrepreneurs want their platform to function seamlessly, and address users` unique needs. Meanwhile, they strive to keep the development process as simple as possible.  FreshTech offers a pre-built toolkit that is ready for launch and can be effortlessly customized to suit the specific requirements of any business. With the ready-made FreshTech's Marketplace Kit, we can launch an MVP version of the project in just 2 months. There are further benefits of ordering a marketplace from us:

• expertise and 15 years of diverse experience in launching e-commerce projects;
• a modular development system with almost limitless customization options, seamlessly integrating with other systems;
• we understand the legal aspects of running a marketplace and incorporate them into the technical architecture of the platform;
• we offer preliminary assistance in building business processes if needed;
• we provide ongoing support even after the development is finished, suggesting ideas and new features that enhance business growth and profitability.

If you are interested in creating a marketplace as an independent business or as a tool to scale your company, leave your contact details. We will review your project, discuss collaboration possibilities, and assist you in choosing the solution that suits your specific needs.