Hello, dear readers!
Due to recent world events, the number of new users in various online stores and marketplaces has increased dramatically. Online shopping is now in its heyday, and the number of online orders has increased almost 8 times.
Therefore, more and more businessmen are planning to retrain from offline sellers to online. But even in the absence of their own products, it is possible to sell other people’s goods.
When cooperating with marketplaces, it is not necessary to spend money on creating an online store, organizing delivery and advertising. The popularity of well-known sites can provide the seller with hundreds and thousands of potential buyers.
That’s why the heroes of today’s article are marketplaces. These are excellent services that will help even beginners to profit from their own or other people’s products. I will tell you what they are, which sites are the most popular, how to start working with them and how to make money on marketplaces.
What are marketplaces
Marketplaces are often mistaken for regular online stores. But this is not entirely true. At the same time, most online purchases are made in marketplaces.
Wildberries, AliExpress, eBay, Joom, Amazon, OZON, Yandex.Market, Lamoda, etc. – popular services where each of us has bought something at least once. They are marketplaces – large intermediary platforms where various goods from many sellers are presented.
Their peculiarity is that almost any product is presented in several variations, from several manufacturers and at different costs. Therefore, the buyer can choose a product by comparing its characteristics, price and brand awareness.
If we make an analogy with offline commerce, a marketplace can be called an online market. On one territory there are several “shops” that offer their goods. The sellers have concluded a contract with the administration, and for a place on the “marketplace” they give a fixed amount or a percentage of sales.
Thanks to marketplaces, sellers don’t have the headache of promoting products and attracting new customers, setting up a retail outlet, setting up payment, finding a place for a warehouse, organizing delivery or returning goods. The platform takes full control over the sale of products.
Marketplaces themselves promote products and brands, attract consumers and can take on the organization of delivery. Also recently it has become possible for platforms to cooperate not only with sole proprietorships and companies, but also with the self-employed.
Therefore, for everyone who wanted to sell their own or other people’s goods over the Internet, marketplaces are just a godsend. This is especially true for those who are starting from scratch and have no experience in online sales. But take into account that these marketplaces really dislike fakes. If the seller is caught selling them, he will face a fine of 10,000$
Another option for earning money on marketplaces is to participate in an affiliate program. To do this, you need to register on the service, get an affiliate link and place it in your blog, in communities or on your profile wall in social networks, etc. Everyone who clicks on this link and buys something brings the referrer a percentage of sales. Many bloggers make money this way.
Features of selling on marketplaces
Speaking about working on marketplaces, to begin with, it should be said that there are ways to earn money with and without investments.
The method without investment involves cooperation with wholesale sites that sell their products only off the Internet. You can offer them services for the realization of their goods through popular web sites. Thus there is an intermediary between the marketplace and the manufacturer.
When negotiating cooperation, you should rely on your knowledge of marketing. It is necessary to explain to potential partners that you better promote the product and can achieve high sales. But in this case, there is a high probability of refusals, because manufacturers may decide that they can cope with this task themselves.
Dropshipping also belongs to the category of “no investment”. I will explain on a simple example. A person receives a list of goods from a manufacturer. It is enough for him a simple list, you do not even need to buy anything. All these products the intermediary exposes on the web-site together with images of the goods, but the price is higher than stated in his list.
Next, the buyer sends a request to purchase some product. The intermediary forwards this request to the manufacturer, who receives it, packages it and sends it to the buyer. Everybody wins:
- the buyer gets his product;
- the manufacturer gets money;
- the intermediary also receives money, namely the difference between the amount requested by the manufacturer and the final value declared by the intermediary.
- Thus, you can exhibit goods on the marketplace, receive income and do not invest anything in it.
Now let’s talk about earning with investments. Still, this method is more popular. Not counting the money that you first need to spend, this option of cooperation with marketplaces is more profitable and easier.
It is good if you are a manufacturer and sell your own goods. In this case, everything is clear. If there is no product, it must be ordered in bulk, starting from 100 pieces. The best place for this purpose is AliExpress. The product should be chosen so that it can be sold quickly with a markup.
When the preparations are finished, it’s time to register on the project. During this procedure, all those wishing to cooperate with marketplaces must provide the following data:
- The name or brand under which the goods will be placed.
- INN, KPP, OGRN, OKPO, OKOPF.
- Full name of the sole proprietorship or LLC.
- Ф. Full name of the head.
- A photo with a passport.
With the self-employed everything is easier. Full name, TIN and passport photo are enough.
In addition, the following documents are required to start selling:
- quality certificates;
- declarations for goods;
- documents for the registered trademark (or permission to use it).
As for the working conditions at the sites, they are similar in many respects. The difference may be in the organization of delivery. It proceeds in one of three ways:
- Delivery is carried out by the seller. After the buyer selects and pays for the product, the system sends a notification about it to the seller. The seller then packages and ships the product to its destination.
- Shipping is the responsibility of the marketplace. After the notification, the seller does not send the product to the buyer, but to the warehouse of the marketplace, from where the delivery is carried out.
- Fullfillment. In this case, the seller immediately transports all of his goods to the warehouse of the site and removes the responsibility for delivery. Now all this is done by the marketplace.
For frequent and large sales, the third option is the most profitable. And vice versa, if purchases are single and infrequent, it is worth taking care of delivery yourself.
Due to the continuous development of services and the emergence of new platforms, marketplaces are getting into a competitive struggle. Often, in order to have an advantage, platforms offer sellers different services and features. These may include:
- Statistics and analytics tools. Sellers can look at different indicators at any time to know market needs, forecast supply and demand, and expand the assortment.
- Mechanisms for attracting customers. These are various advertising programs, settings on the platform itself to highlight products among competitors and much more.
- Electronic workflow. Marketplaces help automate routine processes related to documents, checks and invoices.
- Handling returns. Everything is the same as with delivery: the seller either deals with returns himself, or completely gives this function to marketplaces.
Best sites for making money
At the moment, it is impossible to name a marketplace that would prevail over the others. Users can buy goods in several marketplaces at once, so sellers need to cooperate with a couple or three services in order to increase the number of potential clients and their chance of selling products.
Opening the list of the best marketplaces is an interesting and large project Wildberries. It is a time-tested web platform that has been operating for more than 15 years and cooperates with more than 55,000 sellers.
The service sells clothes and shoes, accessories and jewelry, goods for home and children, airline tickets, auto and pet products, cosmetics, books, electronics, food and much more. But clothing, shoes and accessories are prioritized.
Wildberries takes a commission of 5-19% of sales, depending on the type of goods, and cooperates with sole proprietorships, LLCs and the self-employed.
Marketplace warns sellers that all goods must be delivered to their warehouses, as they are sent to the hands of buyers from there.
The next site is OZON. Only sole proprietorships and companies can register and present their goods on this service. At the same time, any goods can be sold on OZON: books, electronics, animals, clothes, shoes, toys, etc.
The project charges a commission of 5-25% depending on the category of goods. Delivery is carried out either from its own warehouse, or you need to use fullfillment.
Lamoda is a platform where you can find clothes and shoes of famous brands such as: Puma, Nike, Gucci, Versace and many others. But smaller manufacturers are also found on Lamoda.
They sell clothes, shoes, accessories, cosmetics, jewelry and home goods on the service.
Only an individual entrepreneur or LLC can become a partner of the site.
Service takes a high percentage of the sale of goods – from 35%. Plus will have to pay for delivery and processing of orders.
AliExpress is a well-known and popular site where you can find almost anything. A company or an individual entrepreneur can become a seller.
It is profitable to cooperate with the service, since AliExpress does not take a commission for the first six months, unless the number of orders during this time exceeds 100 pieces. After that, the marketplace takes up to 10% of the commission.
Sorting, packing and shipping services can be ordered for an additional fee.
Yandex.Market is a large project that has been operating for over 20 years. As on the previous site, on Yandex.Market it is possible to sell practically any goods except those prohibited by law.
The self-employed cannot cooperate with the service, only sole proprietorships and LLCs can.
The platform charges a commission for each transfer to the seller’s site from the web pages of the marketplace. How much exactly will have to pay, is calculated individually for each manufacturer.
SberMegaMarket offers products from more than 8,000 sellers, with the number of products already exceeding 2.5 million.
The platform sells everything a person could want: electronics, goods for adults, children and animals, household chemicals, food, clothing and footwear, books, furniture, cosmetics and much more.
Unfortunately, only LLC or IE can cooperate with the site, the self-employed are not yet allowed to sell their products on the service.
SberMegaMarket provides marketing tools, logistics, and cash and settlement services. Sellers only need to upload goods to the site. The marketplace also has more than 30,000 points of order delivery.
The service transfers payment to sellers 2 times a week, but it takes a commission of 3% or more.
Step-by-step instructions on how to work with marketplaces
I propose to consider a step-by-step instruction on how to work with marketplaces from scratch, so that everyone knows exactly how to act and how to get a stable income from cooperation with marketplaces.
The instruction consists of only 4 steps and seems very simple. But don’t be fooled. Any work is labor. And if everything sounds simple in theory, then in practice there may be difficulties. Therefore, I ask you to prepare carefully and study all the nuances before you start selling goods on marketplaces.
Selection of goods
If you are not a manufacturer and do not sell your own goods, you may be faced with the question of what products to procure for resale.
First, let’s break down what products should not be:
- Dimensional. This category includes clothing and shoes. The buyer can order an item and then return it if it does not fit. Therefore, the percentage of sales without returns is reduced. Beginners should not start with this type of products.
- Seasonal. I think it is already clear why such products are unprofitable. In some period you can stay completely without profit, and in the season there is no guarantee that sales will be so much that the income will be enough for the whole year.
- Hype. As long as the product is on the wave of popularity, it will be taken. But eventually the demand will fall, and all the purchased goods will remain. That’s how you can go into the negative.
Now let’s see which product is the most profitable:
- Unique. Obviously, any unique item is in demand. It’s hard to create something truly special these days, so you can take something that already exists and add a unique feature to it.
- In-demand. Items that are in demand in any season will be bought anyway. But at the same time, you may have a lot of competitors.
- With distinct advantages. Offer customers something that your competitors can’t. For example, a high quality product, additional options, or a special appearance.
- Cheap. Everyone wants to buy a good thing at a low price. That’s why they often choose marketplaces. There, buyers hope to find what they need, but cheaply. Therefore, it is advised to choose products that are low in cost.
Site selection and registration
I have already described the sites that are the most popular among competitors. If you have not yet decided which one to choose, I suggest you familiarize yourself with the criteria that will help you with this:
- Commission. Each platform sets its own rules, including the size of the commission. It will depend on how much money you have to give to marketplaces and what kind of profit will be waiting for you as a result. The commission can be as low as 10% or as high as 70%.
- Time of payments. Payments can come every day, but on the condition that the goods are bought daily, once a week or month. If you constantly need funds to purchase materials or goods, then it is worth choosing those sites where payments come more often. And vice versa.
- Delivery conditions. I have already talked a little about this: you can send products yourself or rely on the marketplace. But you need to take into account whether the site takes an additional fee for delivery or it is included in the commission.
- Returns. As in the previous point, it is worth choosing sites that undertake the return of goods, and it is desirable that they do not ask for additional payment for this. So you can avoid unnecessary spending.
- Rules of visual design. Some sites have strict requirements for the placement of images of goods, because they often play a decisive role for the buyer in the choice of products. Therefore, if you have the desire and ability to hire a professional photographer to create high-quality pictures, then you can choose any site. If not, you will have to look for more loyal services.
- Ability to work with other web resources. Many marketplaces prohibit cooperation with other similar platforms. At first, when you need to reach the largest audience, you should register on those resources that allow you to work on other sites.
- Marketplace preferences. Most sites advertise and sell goods of almost all possible categories. But it often happens that some specific products are in the greatest demand. Take Wildberrys. Although you can find anything on the site, but this site more often sells clothes and shoes. Take these features into account when choosing.
- Online payment. To online cash registers do not cause a headache, choose sites that accept payment themselves.
- Requirements for the seller. The service can have many requirements for the seller himself. For example, he must be only a sole proprietorship or LLC, a trademark must be registered. Carefully read the rules of the site before cooperating.
When one or more sites have been selected, you can proceed to registration. The procedure is not complicated, but may differ slightly from one service to another.
Work with documents
Collect in advance the entire package of documents required for cooperation with marketplaces. Each service has
Although some sites work with the self-employed, there are still very few of them. And by the way, sellers in this category can sell only self-produced products. Because of this, most still prefer to formalize an IE or LLC. Therefore, we will mainly talk about individual entrepreneurs and companies.
Each marketplace needs different documents, but it is possible to highlight the documentation that is required on most sites:
- TIN;
- questionnaire;
- price list;
- certificate of state registration of IE;
- certificate of registration with the tax authorities;
- letter of registration in the Statregister of Rosstat;
- declarations;
- permission from the right holders to use trademarks;
- copy of IE passport (scan);
- certificate of state registration of changes in the Unified State Register of Legal Entities;
- document on the appointment of the head.
As for certification, most marketplaces do not treat it strictly. But if there is a clause in the rules about it, then be sure to comply with it.
In addition, IEs and companies need to register for EDI. This is electronic document management. To register, you need to:
- obtain an electronic digital signature;
- choose an EDI operator;
- decide on the tariff;
- register on the official website;
- sign the contract and additional agreements.
For most services, a basic offer is sufficient, but some sites ask you to sign a contract with them after submitting all documents. The specifics of the contract depend on the individual terms of cooperation.
It is important to pay due attention to the images of goods. Usually services require that they be vertical, with a width and height of at least 900 and 1,200 respectively. In addition, the photos should clearly show everything, literally every detail, and the pictures should meet the requirements of quality and aesthetics.
You should also prepare a specification. This is a description and basic information about the product:
- Name.
- Brand.
- Retail price.
- Country of manufacture.
- Description.
- Characteristics, etc.
Presentation of goods and their promotion
Simply uploading products and waiting for profits will not work. Yes, services do save sellers from many worries. And the popularity of the site provides stable traffic. But buyers can choose not your products from the list, and competitors.
To avoid this, you need to promote products. This can be done again with the help of marketplace tools. Or you can act on your own. The means of popularizing products can be the following:
- Setting prices for goods according to the service’s recommendations. Platforms to start with offer to sell products at the lowest cost. This will attract buyers. And when the first batch is sold out, you can raise the price.
- Discounts and promotions. These are some of the most effective engines of progress. They can be set independently or again use the prompts of the site.
- Advertising on the marketplace itself. Some services for an additional fee offer to bring your products to the first rows, take a place on banners or the main page, design the product card so that it stands out among the others.
- Feedback form. Platforms provide an opportunity to communicate with buyers. This is very important, because during feedback you can resolve a conflict with the client, offer an additional product to the main purchase or, if there is no product that the consumer wanted, sell another similar product.
- Collecting reviews. Customers often look at reviews before buying. Sometimes customers won’t even consider a product if it doesn’t have any reviews. Therefore, sellers can incentivize buyers to write them. For example, offer a discount for a review or a cashback.
- Proper description of the product. Indicate only useful and truthful information. Do not clog the description with unnecessary information, everything only on the merits. Emphasize the advantages and benefits of the product.
- Add a video. If possible, videotape the process of unpacking the product, its functions, how it looks in action, how it looks on a person, etc.
Sales Tips
What aspiring sellers need to consider if they want to run a profitable business on marketplaces:
- Carefully study the nuances of activity in various niches, assess the pros and cons of selling specific products.
- Study and analyze the activities of competitors: why they are successful or, conversely, for what reason they have disappeared from the sites.
- Use high-quality images of products, which clearly show its merits.
- Create favorable conditions for buyers to write reviews.
- Hold promotions, discounts, drawings.
- Carefully read the rules of the service, so as not to accidentally violate them.
- In case of disputes, try to stand on the side of the buyer.
- Watch the statistics, highlight the products that are bought to a greater extent, and think about removing products that have never been bought in 3-4 months.
- Keep an eye on the quality of the product. Only sell products that you are confident in. Otherwise, you can go into a minus: due to returns, negative reviews, refusals to buy.
- Gather your customer base: email new offers, set up repeat sales, offer bonuses and promotions to loyal customers, and more. 12 best online business ideas
Conclusion
Marketplaces are a great opportunity to start earning even for beginners without large investments. Sellers can use promotion tools, provide routine processes to the service and eventually reach the international level. True, you can’t do without limitations.
Platforms prefer to cooperate with legal entities, and from individuals choose sole proprietorships. And only in very rare cases are self-employed people allowed to sell on marketplaces. To do this, it is necessary to register on a particular platform, for example, Wildberries. In addition, there may be difficulties with the selection of the package of necessary documents.
Nevertheless, I still advise you to try this method of earning. And to give you more confidence in your abilities and knowledge, I suggest taking courses on marketplaces. They will explain how to act, what steps to take, what and where to sell.