Marketplace in B2B businesses. Pros and cons

The Marketplace is an online sales model that places different companies on the same virtual platform so that they can sell their products or services to a third party, whether a customer or another company. In today’s post we talk about the advantages and disadvantages that this business system has.

What is the Marketplace sales system?

The Marketplace sales concept consists of a virtual store where multiple companies at once advertise and offer their products. This platform provides virtual space for sellers who in turn offer information and sale of their goods. We could say that it is a kind of online shopping center where items from different brands are collected.

The Marketplace has a lot of weight to this day. Especially because it allows direct communication and sale between companies without the need for displacement. Which is why more and more businesses are choosing to make their sales on a Marketplace but, what are their advantages and disadvantages?

The main types of Marketplace in the market

Before we look into details about the possibilities of this business model, let’s look at the types out there. Marketplaces can be generalists. It consists of a platform on which you can sell all kinds of products. Or they can be niche, i.e. sales categories are established according to the products. In addition, we can classify Marketplace types based on how they are organized. In this way we distinguish:

  • On demand. Focused on the services sector, it responds to customer demand according to the provider network.
  • Widely used in both B2C and B2B. Manufacturers offer their goods while the platform manages processes.
  • Community-run. The sellers manage customer service as well as shipments.
  • It is based on a P2P (peer-to-peer) model.


5 advantages of the Marketplace in B2B business

The main advantages of the sales system through a Marketplace are:

  1. Increased sales and cost reduction. Selling on a Marketplace increases sales and reduces the costs of maintaining a physical store or e-commerce-based business model.
  2. Possibility to reach more audiences. Marketplace is more visibility and therefore being able to reach more customers. On the other hand, greater loyalty is achieved.
  3. Improves brand positioning. The Marketplace platform will be responsible for improving your market positioning. And, therefore, of the companies that are registered in it.
  4. Flexible payment methods. It provides the possibility for companies to work with flexible payment methods. For example, automatic, multiple, or third-party payments.
  5. The platform can handle logistics. If a company desires, it can leave everything related to logistics in the Marketplace.


And 3 disadvantages to consider

The Marketplace is a good choice for businesses and customers. However, we also need to take into account a number of disadvantages:

  1. Collection of commissions per transaction. Costs may be lower in a Marketplace than in other types of sales methods. However, we must know that a commission will have to be paid for sales.
  2. Marketplace rules may not be the same as our brand rules. Each company, customer or brand has its own rules. The Marketplace will also have its own rules. Therefore, if we want to avoid problems, we must be aware of what rules are.
  3. Being part of this sales model means more visibility for our brand and being next to competitors. Selling at a click is something that we must also value to see if it is what suits us best.

Put aside the advantages of this online sales model and on the other side the possible disadvantages. So, you can find out if it’s a business model right for you. But to have in your hardware company the success you expect, there’s only one thing that can guarantee you: professional management and extensive experience from the IBMH team. Because we are the best partner for your imports of furniture hardware and construction from China. Don’t think about it anymore and contact us today!