How does the Multi-vendor marketplace solution work, with example?

Hey there, no time to wait; let’s discuss the multi-vendor solution, so what is multi-vendor?

Multivendor is a standalone software that allows you to create an online marketplace in multi-vendor independent vendors that sell their products for a single stop front. Millions of marketplaces are built with multi-vendor solutions worldwide. Making it the most popular solution for online malls, so how does multi-vendor work?

As a store owner, you gather independent vendors in your online marketplace, customers buy products from different vendors, and you get commissions from sales. The whole workflow includes five simple steps.

Simple workflow of a Multi-vendor marketplace solution with example

Vendors fill out the application form the store owner approves or declines the applications. Then vendors add products and shipping methods, customers place orders, the store owner keeps commissions, payments are distributed to vendors automatically via PayPal, that’s it.

Let’s take a close look at how it works; there are four stages the store owner is concerned with making preliminary settings in the admin panel, setting up vendor plans, processing vendor account applications and getting commissions. 

First stage:

First of all, the stock owner needs to activate vendors related settings. For instance, if you want to verify each product added by a vendor, enable this feature in the admin panel. 

Second stage:

Secondly, you create vendor plans; you can set up any number of vendor plans with different conditions. Once basic settings are made, your store visitors can apply for a seller account.

Third stage:

This is the third stage. What is remarkable about the multi-vendor solution each seller can have their mini store inside your marketplace. These mini-stores can have a vendor logo, company description, product filters, and search bar. So customers pick products, add them to the cart, and proceed to checkout. When an order contains products from different vendors, shipping cost is calculated separately. 

Of course, the customer pays for only one order from the admin panel side of things. Two separate orders are created. Each vendor can see one order that contains their products only.

So what’s next? 

Fourth stage:

The fourth and final stage is when an order is completed, each vendor gets their payment via PayPal. The store owner keeps commissions to sum it all up. Your income will be commissioned from vendor sales and monthly fees paid by vendors for selling in your marketplace. 

You might think launching an online marketplace with a multi-vendor solution is a complicated task actually, that’s not, so no programming knowledge is required to use our software multi-vendor is a user-friendly solution with step-by-step guides and plenty of support. There are a million examples of successful marketplaces powered by multi-vendor solutions. 

We’ll show you one of our favorites. The online marketplace developed by us is called Muscat food market; the idea of MFM is to connect food lovers with independent food producers from Muscat and other friendly countries. 


With the spark of tactics, it was started in 3 years, actively running with over 100+ vendors showcasing their products on MFM. It’s a success, yes, definitely a true success with no extra penny spent on marketing except the organic tweaks. 

Now you have a general idea of what a multi-vendor solution is and how it works, our sales team is ready to answer any questions.

Contact us today to launch your online marketplace tomorrow.

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