What is a Marketplace Business Model?

A marketplace business model is a type of ecommerce platform where the website operator doesn't hold the inventory or the products for sale. Instead, the marketplace allows third-party vendors to sell and reach customers directly. The difference between traditional ecommerce and a marketplace business model is that marketplace websites do not own any inventory but act as intermediaries between buyers and sellers. This means that, as a marketplace, you don't assume risk or invest in inventory. Instead, you can monetize through a range of business models, including commission, list fees, and more. By allowing third-party vendors to use your platform, you can provide a diverse range of products and services to your customers without worrying about sourcing and maintaining inventory.