The variety of platforms for online trading confuses the seller: what to choose, and where will it be more comfortable to build a business in 2023? It is impossible to give an unambiguous answer, but you can analyse the conditions of each marketplace and find their pros and cons. With this information, it is easier to make the right choice. Yury Gorbachev, managing partner of Lirate, spoke about the advantages and disadvantages of popular Russian marketplaces in 2023.
Pros And Cons Of Trading On The Marketplace
Before analysing the conditions of each site, you need to understand whether it is worth entering marketplaces in 2023. I believe newcomers on these sites need help to succeed. However, this statement continues to be refuted by persistent and purposeful sellers who enter the marketplace and achieve high sales quickly.
Marketplaces were strengthened by quarantines, the departure of foreign brands from Russia, and other less significant events. Therefore, despite the competition, the chance of a successful startup remains high.
If you are unsure that you want to try yourself as a seller on a well-known online platform, consider the pros and cons of such an activity in 2023.
Let’s start with the pros:
- To enter the marketplace, you need to perform a minimum of actions. Often enough to pass the standard registration.
- You immediately get a multi-million audience. It is only sometimes necessary to set up advertising and spend money to attract traffic; often, everything happens by itself.
- The vast geography of sales. The product is available for buyers in Russia, sometimes for other countries, which increases the chances of a purchase.
- Intelligent logistics. Marketplaces themselves think over the path of the goods from the seller to the buyer and carry out the process according to an already worked-out scheme.
- Low entry threshold. As a rule, little investment is needed. Often you only need to purchase goods and leave finances to pay mandatory expenses.
- There are places to store goods. The seller chooses where to store the goods: use the site’s warehouse or other options.
- Availability for consumers at any time. Even on Sunday night, the system processes orders; the seller can rest and do other things now.
- Access to analytics. Each site has tools that help you control the situation in the marketplace and make timely decisions.
- Customers trust the marketplace more than an unfamiliar store. People are much more willing to pay for online purchases on the market than on the website of a company or manufacturer.
- The ability to quickly test the demand for a product without extra investments. No need to create a separate landing page to test the market, make a product card and see if consumers will buy.
- No need to recruit staff; the first steps can be done alone. To service your business, you may need additional people; everything is automated in the marketplace, so keeping employees in the first stages makes no sense.
- You do not need to buy an online cash register, register it and maintain it; the marketplace will do it. Trading through your platforms is fraught with difficulties and additional steps.
- Big competition on popular sites. At the same time, there are still niches in which competition is low. You need a thorough analysis if you want to work on an online platform.
- Most sites require a trademark certificate, certificates, and declarations from sellers. Marketplaces value their reputation, so they pay attention to the seller’s documents.
- You need to pay the marketplace for storage, logistics and other actions.
- The marketplace blocks a product or a seller from violating the site’s rules and the law. Sometimes locks happen by mistake, but this is rare.
- Additional costs are only sometimes possible to take into account. It is difficult for beginners to calculate all expenses; some are non-permanent, for example, returns.
- A sudden increase in commissions and fees without warning. Marketplaces change the terms of the offer unilaterally, of course, in the direction of their enrichment, which is sometimes detrimental to sellers.
- You have to compete on price. You won’t be able to set the price you think is necessary; the sites monitor the price level for similar products. Sellers have to set prices that are close to competitors.
These are the general advantages and disadvantages of working in the marketplace in 2023. If the cons do not bother you, you can choose a specific site for work.