How To Build a Multivendor Marketplace in 6 Steps

A multivendor marketplace is an online ecommerce business where multiple sellers sell their goods. Shoppers can browse offerings from multiple independent sellers and purchase products via a unified checkout experience.

The largest multivendor marketplace is Amazon, where the majority of sales are from independent vendors. But niche businesses can benefit from a multivendor marketplace. For example, Zero Waste Store uses the multivendor business model to showcase sustainable sellers alongside their own in-house product lines—a model that proved successful. The brand grew from $6,000 in sales in their first year to $2 million the next.

In this article, you’ll learn how a multivendor website works, different types of multivendor marketplace operations, and how to set up a multivendor marketplace business of your own.

What is a multivendor marketplace?

A multivendor marketplace is an ecommerce website where multiple independent sellers list and sell products or services to a shared pool of buyers. The marketplace platform owner doesn’t handle inventory management or order fulfillment for the sellers. Rather, marketplace owners build the infrastructure and provide marketplace functionality including search, checkout, payment processing, and site security.

On a multivendor ecommerce website, buyers browse a single catalog assembled from many independent sellers. Marketplace vendors are responsible for their own listings, pricing, and fulfillment. 

This model can enable marketplaces to scale faster than traditional single-vendor stores. Adding sellers to the platform adds selection without adding inventory risk for the operator. Wider selections can attract more buyers, which in turn attracts more sellers.

Vertical vs. horizontal marketplaces

There are two categories of multivendor ecommerce marketplaces: vertical and horizontal. 

A vertical marketplace focuses on one category in depth (e.g., Reverb for musical instruments, StockX for sneakers and collectibles), while a horizontal marketplace spans many categories (e.g., Amazon, eBay). 

Vertical marketplaces typically compete on category expertise and trust; for example, musicians turn to Reverb to find items sold by other musicians or music specialists. Horizontal marketplaces compete on selection and convenience; they’re the big box stores of ecommerce.

Types of multivendor marketplaces

• Product marketplaces
• Service marketplaces
• Rental marketplaces
• B2B marketplaces

A multivendor ecommerce platform can take many forms, with different specialties and marketplace capabilities. Here are some variations on the multivendor online marketplace model:

Product marketplaces

This type of multivendor platform connects buyers with sellers of physical goods. 

Amazon is the largest by net sales, and third-party sellers accounted for 60% to 62% of units sold across 2025, per Amazon’s own quarterly disclosures. Walmart has similarly embraced third-party sellers in addition to its own direct online sales. 

eBay remains one of the longest-running examples, enabling nearly $80 billion in gross merchandise volume in 2025 and serving 135 million active buyers across its marketplace. Etsy, which is built around handmade and vintage goods, ended 2025 with 5.5 million active sellers and 86.5 million active buyers on its core marketplace.

Service marketplaces

This type of multivendor marketplace website connects buyers with independent workers rather than physical inventory. Upwork and Fiverr are the two biggest examples in freelance work, matching businesses with designers, developers, and writers and taking a service fee on each contract.

Rental marketplaces

Rental marketplaces monetize temporary access to an asset. Airbnb is the largest example; its gross booking value grew 12%, to $91.3 billion, in 2025. Turo applies the same model to peer-to-peer car rental, where hosts choose an earnings plan that determines what share of the trip price they keep versus how much protection coverage they’re given.

B2B marketplaces

Business-to-business (B2B) marketplace operators connect businesses with other businesses and tend to involve larger order sizes, procurement workflows, and account-based pricing. Faire connects independent retailers with wholesale brands. Alibaba connects product designers and dropshippers with manufacturers. 

How to build a multivendor marketplace

1. Choose your niche and confirm demand
2. Decide on a business model
3. Choose your platform software
4. Add marketplace functionality
5. Recruit and onboard your vendors
6. Launch and make continual improvements

You don’t need to be an ecommerce behemoth to create and maintain a multivendor site. With the help of Shopify, you can create an ecommerce store with multiple vendors that has the same key features and platform capabilities—like secure payment processing—that you’d see in single-vendor stores. 

Here’s how to build a custom marketplace of your own:

1. Choose your niche and confirm demand

Starting narrow will help you capture a specific niche market. Before writing a line of code or installing an app, validate that both sides of your marketplace exist: enough vendors willing to list and enough buyer demand.

Talk to prospective vendors directly, look at adjacent ecommerce websites’ category performance, and determine if there’s a niche that’s profitable enough to merit diving in. If you aren’t certain, consider running a manual, unscaled version of the concept (e.g., a curated list, a pop-up, a waitlist) before building anything.

For an example of a niche marketplace, consider Zero Waste Store. Founded by Sarah Zelinsky and JJ Philo, the brand is built around thoughtful curation for a market that values sustainability. Sarah spent six months researching small, plastic-free-packaging brands before launch, and the store has grown dramatically from there. 

“We’re adding new products every day, whether it’s through our essentials line or adding new small businesses to the marketplace side,” Sarah says on the Shopify Masters podcast.

2. Decide on a business model

Choose revenue streams that will support your business and decide on a pricing strategy that fits your category. Owners have many ways to generate revenue from the multivendor marketplace model, including:

• Commissions. Marketplace operators can take a percentage of each transaction or levy flat transaction fees. For example, as of Q1 2026, freelance marketplace Upwork charges freelancers a marketplace take rate of 19.4%.

• Subscriptions or membership fees. Some marketplaces charge a recurring fee for sellers to access the platform or unlock premium tools. Such fees are often layered on top of commissions rather than replacing them.

• Listing fees. A listing fee is a flat charge to publish a listing regardless of whether it sells, common in classifieds-style and craft marketplaces.

• Value-added services. Platforms can charge for payment processing, advertising placements, fulfillment, or insurance products sold to vendors.

Marketplace operators typically rely on a variety of revenue streams: For example, Etsy’s core marketplace generated roughly $10.5 billion in gross merchandise sales in 2025, and its consolidated take rate—commissions and listing fees plus payment processing, advertising, and other services—reached 24.5% in the fourth quarter of 2025.

3. Choose your platform software

At this stage, marketplace operators can choose among three paths for their multivendor marketplace software: fully custom development, open-source marketplace software, or building on top of an existing ecommerce platform using marketplace apps. Custom development brings the most flexibility but the highest cost and longest time to launch.

For first-time operators, building on Shopify is a faster route. Shopify handles checkout, multiple payment options, site hosting, and security, so your marketplace-specific work (vendor onboarding, order splitting, vendor payouts) can be layered on top rather than built from scratch. This allows store owners to focus more on vendor management than website functionality.

“Shopify as a whole, being an all-in-one ecommerce platform, really covers all your bases for anybody starting an ecommerce business,” Zero Waste Store’s JJ says. “If you have functionalities that you want to implement into your business, you can always find a Shopify app for it, which is huge for somebody that doesn’t want to pay a developer.”

4. Add marketplace functionality

A standard Shopify store is single-vendor by default, but a variety of apps in the Shopify App Store can convert your site into a multivendor marketplace. These apps generally handle the mechanics that differentiate a marketplace from a regular store: individual vendor dashboards, automated order routing and splitting when a single cart includes items from multiple sellers, commission calculation, and vendor payouts. Examples include:

• Webkul’s Multi Vendor Marketplace. One of the longest-running options among these third-party services, Webkul provides an extensive add-on library including for hyperlocal, B2B, and auction-based marketplaces.

• Shipturtle. The Shipturtle app focuses heavily on order automation and logistics, including automatically splitting and routing orders to the correct vendor and integrating with a large pool of shipping carriers. These features help you absorb meaningful order volume from day one.

• Onport. The Onport app is aimed at multisupplier operations that need custom integrations. It works with many ecommerce platforms including Shopify; it also supports a fully custom storefront you design yourself.

If your marketplace concept is lighter-weight—for instance, a handful of complementary D2C brands cross-selling each other’s products rather than an open marketplace with many independent vendors—you may consider Shopify Collective instead of a full marketplace app. 

Shopify Collective allows a store to sell another Shopify business’s products directly from its storefront. Orders are routed to the supplier for fulfillment and revenue splitting. It’s free for eligible stores and built for curated brand partnerships rather than open vendor onboarding at scale.

5. Recruit and onboard your vendors

Before you direct buyers to your multivendor marketplace, you need vendors on the site. You can solve this by proactively recruiting prospective vendors, offering reduced or waived fees for early sellers.

Ease the friction on vendor onboarding by providing template listings, clear commission terms, and a user-friendly dashboard to help vendors manage their listings. You can cold call or cold email vendors, reach out on social media, or use existing relationships to broker a meeting. Pitch your marketplace website as a supplement to the other channels they’re already using.

Zero Waste Store looks for sellers that complement its own product lines and fill in gaps. “There are brands that develop products that we don’t, skin care being an example,” JJ says. “There are other brands that do a way better job than probably we would be able to, and provide it to the consumer at a way more affordable rate.”

6. Launch and make continual improvements

Rather than wait for the perfect blend of sellers, begin your market entry with a smaller catalog and a tighter buyer base, then iterate over time. 

Track core metrics like active buyers, active sellers, gross merchandise sales, and take rate; these will signal whether both sides of your marketplace are growing. Expect to revisit how you recruit more sellers, onboard vendors, structure commissions, and promote your site in a competitive market. What works for the first 10 vendors may no longer apply by the time you onboard vendor 100.

Using Shopify lets marketplace entrepreneurs integrate third-party services and expand functionality via the Shopify App Store. This can help you broaden your marketplace features while remaining on the same platform.