As the fastest growing B2B sales channel, online wholesale marketplaces are currently dominating the B2B eCommerce landscape.
These platforms provide greater opportunities for aspiring wholesalers to expand their reach and boost their sales.
According to a recent study, sellers who take advantage of marketplaces can see a 38% increase in their sales compared to just using their own website.
And those who sell on two marketplaces can experience a whopping 120% boost in revenue.
With so many growth opportunities, let’s discuss how marketplaces can help make your online wholesale business a profitable venture.
Cost-Effective For Startups
Starting your online business on a wholesale marketplace is much easier than a standalone eCommerce website.
The thing is if you choose to sell through a standalone website.
You’ll have to spend a lot of time, effort, and investment in things like buying the right domain and a cloud hosting server, designing the website and marketing it to generate traffic.
Fun fact: starting an eCommerce website takes up to $60,000, while the maximum costs of an annual subscription on a marketplace are about $5,000.
You can save a lot of your time and costs in setting up an online storefront on a marketplace.
There are many ready-made templates available on some of these marketplaces that help you build a professional storefront for your business.
It’s a cheaper way to establish an online presence for your wholesale business on a limited budget.
Marketplaces have a good return on investment (ROI) and are pretty cost-effective for startups.
Reduced Marketing Efforts
Online wholesale marketplaces are great platforms that allow wholesalers to promote their businesses efficiently.
Wholesalers don’t need to put much effort into planning a proper advertising campaign to showcase their products.
These marketplaces already have an established audience that is searching for the products they want.
And the best part? You don’t have to spend like crazy to reach your target audience which you’ve to do if you’re using any other sales medium.
To appear in the search results, simply upload eye-catching product images and craft a compelling product description that speaks directly to your target market’s needs.
Don’t forget to add keywords with a high search volume to your product description, helping you gain more buyers’ attention.
To skyrocket your visibility, take the time to optimize your product pages and store, giving you the edge in the marketplace’s search results.
Cheaper Compared To Other Sales Channels
A major reason that online marketplaces attract more sellers is that these marketplaces are less expensive than other digital sales channels.
On average, wholesale marketplaces require a yearly subscription fee that ranges from a low of $1200 to a high of $7000, with some even offering additional services to elevate your business’s promotion and marketing efforts.
If you promote your business through a sales channel yourself, you’ll have to pay a lot of money.
Let’s break it down in this table to understand the minimum average annual costs of effective B2B sales channels.
|Average Annual Costs
|Search Engine Optimization
|$18000 ($1500 monthly)
|$10800 ($900 monthly)
|$3600 ($1500 monthly)
Online marketplaces present a simple solution for boosting your wholesale business’ customer base.
Utilizing these platforms allows your target audience to discover and connect with your business, leading to increased sales.
That’s why 79% of the suppliers have already built or are looking to build an online B2B marketplace, as per a recent study.
High Return On Investment
It’s a very popular statement that your own online website is very profitable as you control all of your customers and your profits on sales.
You don’t have to share your profit with anyone else, unlike some marketplaces which charge some percentage of commission on your sales.
However, in spite of the minimal commission that you’re paying, you can’t deny the fact that marketplaces generate reasonable profits for businesses.
In fact, a study by Making Science found that sellers who sell on marketplaces see a 38% higher ROI compared to those relying solely on their own websites.
A Safe Bet For Potential Clients
It’s tough for new buyers to confide in you and buy your products if they are unaware of you, especially online when they can’t physically verify you.
Selling on reputed marketplaces like Alibaba and SeeBiz helps you win customers’ trust and sell your products easily in such a case.
The reason is that buyers trust the marketplaces as reliable platforms. The positive reputation of marketplaces convinces buyers to make a buying decision quicker than other sales channels.
Your presence on these trusted marketplaces helps you to gain credibility, win customers’ trust, and strengthen your own brand.
Sales Recover Subscription Costs
The membership costs of a wholesale marketplace are very affordable for small-to-medium businesses, which they can recover very easily.
Because in the world of wholesale, purchasing happens on a massive scale, meaning even one successful sale will easily offset your membership costs.
Let’s break it down with a real-life scenario.
Imagine you’ve subscribed to a wholesale marketplace with annual charges of $1,500, and you’re selling t-shirts in bulk at the selling price of $8 per unit.
And you secure a deal on the marketplace of 1000 – 2000 t-shirts.
This deal alone can cover your subscription costs with ease.
Wider Profit Margins On Sales
Some wholesale marketplaces don’t charge you a commission on sales, which greatly benefits sellers, especially startups.
Along with potentially acquiring more customers for your business, you can increase your sales and reap maximum profits out of these deals.
By not paying any commission on these transactions, your revenue can increase to a great extent, and your business can grow significantly.
Online marketplaces are the best source for small wholesalers to start and grow their wholesale businesses.
With a wealth of benefits and endless opportunities, it’s the perfect launchpad for your online wholesale empire.
Don’t wait for your competitors to catch up—capitalize on this opportunity and skyrocket your wholesale success today!