How to create a multi-vendor marketplace: the complete guide

A multi-vendor marketplace does not sell its own products: it connects independent sellers with buyers, and usually earns a commission on each sale. Buyers get more choice, sellers reach customers they would not reach alone, and the operator has a model that grows with the number of sellers.

It is also one of the most demanding digital products to build. You have to manage several catalogues, split orders, pay the right seller and settle disputes. This guide details the essential features, the role of the back office and how to launch a first version that holds up.

01The three profiles of a marketplace

Each profile has its own screens, rights and expectations. Designing them separately from the start avoids compromises that satisfy nobody.

• The buyer: they search, compare offers from several sellers and order in one go. They expect reliable information and a way to get help if something goes wrong.
• The seller: they publish products, manage stock and prices, process orders and follow payouts from a dedicated space.
• The operator: they approve sellers, set commissions, moderate listings and settle disputes. They are the guarantor of trust.

02The essential features

1. 01
   Seller onboarding and verification. A form, supporting documents and approval by the operator before anything goes live.
2. 02
   Catalogue per seller. Each seller manages their own product pages, prices and stock, with a storefront in their name.
3. 03
   Mixed cart and sub-orders. The buyer pays once; the order is then split into sub-orders, one per seller, each with its own status.
4. 04
   Commissions and payouts. The platform calculates its commission on each sale, then pays the balance to each seller on a known schedule.
5. 05
   Shipping per seller. Fees, lead times and zones specific to each seller, or central logistics if the operator handles it.
6. 06
   Ratings and reviews. Only buyers who received their order can leave a rating, which limits fake reviews.
7. 07
   Returns and disputes. A clear procedure: a request from the buyer, an answer from the seller, arbitration by the operator when needed.
8. 08
   Listing moderation. Checks for banned products, misleading descriptions and duplicates, before or after publication.

03The operator’s back office

The operator runs the marketplace from a back office that must give a complete view, without separate files:

• seller sign-up requests and their documents;
• all orders and sub-orders, filtered by seller, status or date;
• commission calculation and the payouts owed to each seller;
• the queue of listings to moderate and of open disputes;
• dashboards on sales, the most active sellers and growing categories.

Codex builds management tools of this kind, such as AZ fulfillment, an e-commerce management platform that brings orders, stock and statistics together in one dashboard.

04Payments and the sellers’ money

In a marketplace, the buyer’s money does not all belong to the operator. You need to decide who collects it, when the commission is taken and when the seller is paid, often after delivery or once the return period ends. Online payment goes through an approved payment provider; in Algeria, it lets you accept CIB and Edahabia cards, and cash on delivery remains common.

With cash on delivery, each sub-order is collected separately and must be reconciled seller by seller. Collecting money on behalf of third parties may also come with specific obligations: this is a point to confirm before development.

05The chicken-and-egg problem

Without sellers, no buyer comes; without buyers, no seller stays. It is the main risk of a marketplace, well ahead of the technology.

The safest answer is to start with a niche: one product category, one city or one specific type of customer. Recruit sellers first, one by one, and help them publish a quality catalogue. Once the offer is sufficient, invest in bringing in buyers, then widen to other categories.

06Legal and tax points to check

A marketplace creates obligations for the operator towards sellers and buyers. These topics are checked with your legal and tax adviser, depending on the country:

• the status of the operator and of the sellers admitted: businesses, individuals or both;
• the terms and conditions for sellers and for buyers;
• the invoicing of commissions and the tax treatment of sales;
• the rules on collecting payments for third parties and on data protection.

07A useful first version, then improvements

The first version is usually a responsive website, easier for buyers to discover, with a seller space accessible from a browser. The Codex website development service covers this foundation. That first version contains:

• seller onboarding and approval;
• the catalogue, search and the mixed cart with its sub-orders;
• commission calculation and payout tracking;
• the operator’s back office, with moderation and disputes.

Then, depending on real use: a mobile app for loyal buyers, promotion tools for sellers, finer statistics or central logistics.

08Mistakes to avoid

• opening every category at once, without enough sellers in each;
• letting sellers publish without approval, at the risk of poor-quality listings;
• discovering the payout and commission rules in the middle of development;
• neglecting disputes: a buyer with no recourse does not come back;
• publishing the platform on accounts and a domain that are not in your name.

09What changes the budget

The cost depends on the scope, not on a standard rate. The main factors:

• the commission and payout rules;
• the payment methods and the integration with the provider;
• how delivery is handled: per seller or central;
• the level of moderation and dispute handling;
• the target channels: website only, or website and mobile apps.

Codex sends a detailed quote after the scoping workshop. To prepare that meeting, read how to write a project brief.

10The steps with Codex

1. 01
   Discovery. A workshop on your niche, your sellers, your commission and payment rules. You leave with a clear scope, a schedule and a detailed quote.
2. 02
   Design. The buyer journey, the seller space, the operator’s back office and the technical architecture. You approve every screen before development.
3. 03
   Development. Short sprints with a demo at each step, and tests on sensitive cases: mixed cart, partial refund, dispute.
4. 04
   Launch and support. Go-live on a domain and accounts in your name, training for your team and the first sellers, then maintenance and new features.

Read next: investing in a marketplace in Morocco, investing in an e-commerce website or application and how to create an affiliate app.

11Building it with Codex

Codex is a software studio founded in Algiers in 2014. More than 15 engineers and designers build products in French, Arabic and English, and the team has built more than 20 products in-house. The source code, the accounts and the data stay in your name. See the published projects and the certificates of completion.

No office is added locally. The work starts from Algiers (Cité 440 Logements, Ain Malha, Djasr Kasentina), Doha (Building No. 157, Street No. 301, Zone 69, PO Box 8388) and Marseille (Rue de la République, 13002).