07Sep 2023

Pros and Cons: 3rd Party E-Commerce Sites

The introduction of the World Wide Web has revolutionized almost each and every aspect of life. We, now, practically lead our lives in the virtual space with everything from banking to shopping being done on the net. In such a situation, it is imperative for entrepreneurship to have an online presence in order to have a wider customer base and greater profit base. However, creating websites, selling products and managing payments and other associated activities might be prove to be a herculean task, especially for startups. This is where the use of ecommerce marketplace software by retail marketers proves to be useful. Entrepreneurs can simply put their products on a third party e commerce marketplace platform and reap the benefits. However, like a number of other things, this set up also comes with a number advantages and disadvantages.

What Is Third Party E Commerce Site?

What Is Third Party E Commerce

Having an online presence is now considered to be of utmost importance for the success of a company. Entrepreneurs wishing to push up the profit margins need to sell their products online and widen their customer base. However, selling products online requires a lot of work- right from the creation of the websites, selecting and putting up the products for sale, shipping the products, dealing with payment options and a variety of other things. This can be overwhelming, especially so if the company in question is a startup. This is where the third party e commerce sites come into play. To put it everything in simple terms, third party ecommerce marketplaces simplifies things and does all of this for you for a fee.

The third party marketplace business model effectively transfers the charge of maintaining stock list, management, product descriptions and other associated activities to the marketer. In this model, third party marketplaces puts the product of the marketer on display, deals with and collects orders, manages payments, ships orders, tracks delivery and releases payment to the seller at the end after deducting a percentage of the sum as fee. A majority of these entrepreneurs do have virtual presence in the form of their own websites and sell products from those platforms as well. However, third party marketplaces have become an attractive option owing to the huge traffic that such sites garner.

The Pros of Using Third Party E Commerce Sites


The application of third party e commerce sites has been on the rise for some time now. Entrepreneurs are opting for the said business model as not only does it simplify things for them but also provides a boost to the revenue. There are a number of obvious advantages of going for third party selling websites over the conventional kind of ecommerce websites.

Read more on the reasons for having a responsive website for an E-commerce site.

  • Startups and small business owners often find it difficult to attract even a small fraction of traffic to their own websites. Along with everything else, managing websites, hosting, accounting, payment gateways and other such additional requirements need a lot of effort. Third party e commerce websites does the work effectively and efficiently, thereby, allowing these companies to concentrate on other aspects of their trade.
  • Existing third party e commerce marketplace platforms already have a huge customer base. Millions of shoppers visit and shop on these sites regularly. Hence, entrepreneurs can garner greater sales volume just by the scale and the presence of such platforms.
  • Such websites also allow customers to gain new customers. Customers generally do not search for a particular store; they search for a particular product. The presence of your product may have the appeal which the products of other companies lack. This often leads to winning a customer and a possibility of repeat business.
  • Such e commerce market platforms also have the ability to sell a considerable number of Stock Keeping Units without managing any kind of stock list or inventory.
  • A definite improvement in serviceable efficiencies can also be observed with the transfer of a fraction of the overheads to the seller.
  • Going for third party selling websites can also boost revenue by a considerable extent. Such platforms generally provide multiple payment options to customers such as PayPal, Bitcoin and the like along with gift vouchers and coupons. Such sites also have the capability of dealing with a huge amount of order processing and have in-built newsletters and email marketing strategies in place. All of these coupled with the presence of e commerce experts contribute towards boosting revenue to a great extent.
  • Entrepreneurs can also put their new products to test and gain an idea of how it fares. This can be done in small quantities with minimum risks. Read more details on the tools required for the success of an e-commerce site.

The Cons of Using Third Party E Commerce Sites


The next obvious concern that one needs to address is whether the use of third party ecommerce marketplaces all about advantages. Like everything else, third party marketplace business model also has two sides. While the benefits of going for such a platform are obvious, there are a number of disadvantages as well which entrepreneurs need to have a clear picture of.

  • The very first problem of using such platforms is the loss of identity. Third party ecommerce websites are more likely to focus on products rather than the store. This, in turn, limits the way in which entrepreneurs market the brand and build brand value and the like.
  • Keeping track of stock becomes difficult and entrepreneurs might find it difficult to manage things between their own website and the third party websites. It also becomes difficult to manage inventory and entrepreneurs often have to resort to manual methods to comprehend the stock levels. Alternatively, the marketplaces can also identify the popular products of your store and stock them accordingly and sell themselves.
  • Entrepreneurs also need to understand that every individual marketplace is different in terms of the audience and their demands. Hence, it is imperative to go for the marketplace that will best cater to the needs of the business.
  • Customer demands and requirements upgrade almost daily. Hence, it is important to hire staff that will be easily able to keep pace with such situations and coordinate details easily.
  • Third party e commerce marketplace platforms generally charge a percentage of each sale as fees and this amount can vary from one platform to another. Such platforms also have a host of additional charges in the form of listings, advertisements, promotions and the like.
  • Putting up product descriptions in these marketplaces can be a challenging affair, especially when the entrepreneurs deal with multiple products. In order to sell your products, it is imperative to include a product description that will match the description of other similar products sold on the marketplace. This situation holds true with regard to brand, color, image, product type, title, UPC, manufacturing details and the like.

Read more on the criteria for selecting the platform for an e-commerce site.

The Popular Third Party Ecommerce Marketplace Platforms


With the increase in its popularity, the number of third party e commerce websites has escalated to a great extent. Entrepreneurs now have multiple options before them where they can choose to sell their products, often going for multiple platforms. However, choosing the best online marketplace for sellers is important in order to garner a wider customer base and enjoy greater revenue. The popularity of marketplaces has led to categorization with platforms being specific about the kind of products they sell. There are marketplaces that focus exclusively on electronics, while some others focus on clothing and apparel. There are a number of such platforms that cater to almost all the categories. Hence, it is imperative to select third party e commerce sites based on the type of product you wish to sell. It is not always necessary to have a presence on all the marketplaces in order to garner the required amount of revenue. It can be done by simply maintaining presence on specific marketplaces as well. Some of the most popular third party e commerce marketplace platforms include Woocommerce, osCommerce, Wix, Magneto, BigCommerce, Shopify and the like.

1. Magneto

Magneto easily qualifies as one of the leading third party ecommerce marketplaces on the block with commendable global presence. About 1 out of every 4 retail-store owners go for this platform owing to its advanced marketing features, search engine optimization and catalogue administration tools that allows retailers do design their store based on their unique requirement. This platform focuses on the successful integration of both the physical and digital experiences of shopping, making itself a delight amongst customers. It is forerunner in terms of open source ecommerce platform and also features a commendable case of cloud-based omnichannel resolutions, incorporating areas such as, order management, in-store and retail cohort. This platform is supported by a wide network of around 300 solution and technology associates and more than 150000 developers. It also ensures that customers stay happy with the mobile shopping experience by allowing the integration of your online store with the mobile store.

2. Woocommerce

With Blue Star Coffee Roasters, Wakami, Forage and Graze to its credit, Woocommerce definitely stands out as one of the best third party ecommerce marketplaces for entrepreneurs looking to sell their products online. This platform is built to work effortlessly with WordPress and as such is one of the best options for existing WordPress users. The platform also makes your site compatible both on desktop and mobile and is completely open source, allowing retailers to gain from the contributions of the ever expanding community. A dedicated team of support staff are ever-ready to help out the customers in all the possible ways. This platform also allows entrepreneurs to sell their products globally or in the country of their choice.

Also Read: 10 Top Tried-and-Proven Tips to run a WooCommerce site successfully

3. Shopify

The shopify ecommerce platform is one of the most popular third party marketplaces. Setting up stores is relatively uncomplicated for entrepreneurs on this platform. Shopify reviews show that this platform is one of the best in terms of security and speed. Your customers will shift their base to a rival website if they have to wait too long before their orders can be processed and payment options accepted. With shopify, you can let go of these worries and focus only on selling your products. This platform also comes packaged with all the necessary features and has a great customer support option. Shopify is also a great option in terms of marketing and design layout though the latter might prove to be a tad simple. This marketplace also charges fees on every sale with the charge being around 2%of the sales value for the basic shopify plan, 0.5% of the sales value in case of advanced shopify plan and 1% of the sales value for the shopify plan.

Apart from the aforementioned websites, Volusion, Squarespace, Abaco Small business etc are also some of the most well known third party ecommerce sites on the block.


Third party e commerce marketplace platforms allow entrepreneurs to easily and quickly launch their products and earn huge profit margins without having to undergo the associated hassles. The use of such platforms contributes towards making the pricing of goods even more competitive. You also need to be on top of the form when it comes to tagging your product with proper descriptions, image, title and the like. In conclusion, one could compare third party e commerce sites to shopping malls where different sellers display their products and customers choose among the variety of stores and products. Web stores more or less work in a similar fashion with the major difference coming about in approach and of course the profit margins.

Acodez IT Solutions is an ecommerce website development company based in India catering to the online needs of businesses world over. Your dream of having a successful website can come true with the help of our talented team working on website designing, digital marketing, SEO services and Inbound marketing services.

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Jamsheer K

Jamsheer K

Jamsheer K, is the Tech Lead at Acodez. With his rich and hands-on experience in various technologies, his writing normally comes from his research and experience in mobile & web application development niche.

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