Marketplaces have evolved into a dynamic ecosystem where sellers face challenges of oversaturation, price competition, and increasingly stringent platform policies. This article explores how the market operates, key issues illustrated with practical examples, a step-by-step adaptation plan, and prospects for sellers in 2025. By following a structured approach, you can minimise risks and enhance your chances for success.
What are Marketplaces and How Do They Work
Marketplaces function as digital markets with vast assortments: identical products often have multiple offerings with varying pricing, promotions, and displays. The model is straightforward: a seller registers, uploads product listings, connects their logistics with the platform, and promotes items through advertising. Sellers gain access to millions of customers both domestically and internationally, while customers enjoy choices that cater to different budgets and preferences. However, the increase in participants has led to overcrowding: in popular categories, thousands of similar items engage in price wars, where undercutting undermines margins.
Advantages and Risks for Sellers
The main advantage is scalability without the need for proprietary infrastructure: platforms provide traffic, analytics, and delivery services. However, the risks outweigh the benefits: price undercutting can reduce prices by 50-70%, fees may reach 20-30%, and regular changes in regulations (logistics, storage, VAT) conduct a 'clean-up' of weaker players. Forecasts predict that 70-80% of sellers will exit the market, leaving manufacturers with predictable assortments and low costs. External factors such as tax regimes and supply traceability intensify pressure on 'grey' schemes.
Practical Case Study: Artificial Fur Coats
Taking the niche of artificial fur coats as an example — which has good margins and less competition (16,994 listings compared to 356,283 dresses). The wholesale price of a quality coat is around 5,000 roubles, with seasonal retail prices ranging from 13,000 to 20,000 roubles. The product listing is well-promoted, generating sales, but it does not rank in the top for key search terms: competitors have been undercutting prices to 6,000 roubles (while production costs are around 5,000 roubles). Honest sellers are forced to lower their prices, thereby diminishing their profits. This is a classic scenario: a 'neighbour' with no investment in production pushes out the 'manufacturer'.
Analogy of Price Competition in the Market
Consider a market model: Seller A launches a product at 500 roubles each, ensuring a 40% margin due to an optimised supply chain. Seller B enters with a similar product priced at 450 roubles, sacrificing margin for volume. Seller A loses 30% of orders and adjusts their price to 460 roubles. A reduction cycle begins: margins shrink, quality suffers. Now you, with investments in production (akin to nurturing an apple tree: planting, agronomy, certification), offer a product for 700 roubles against the 'speculator' with zero investment (9 roubles versus 10 roubles per kg). How do you justify premium value to hundreds of buyers within the platform's algorithms? Undercutting destroys market efficiency, where competition should ideally stimulate innovation and increase value.
Cost Structure and the Role of Manufacturers
The wholesale price includes production costs, supplier margins, and additional seller expenses: packaging, photography, commissions, logistics, storage, advertising, taxes, and profit. The final price is often unattractive for buyers. Manufacturers bypass intermediaries: lower prices, reduced shortages, stable assortments. Platforms impose stricter conditions specifically for this reason — 'cleaning' out resellers. Interestingly, the MarketHub.pro team has thoroughly studied these challenges in practice: their service automates accounting and analysis, helping to track 'black holes' in expenses — from logistics to advertising. More details can be found on their Telegram channel, where they discuss real cases of direct sourcing from factories.
Step-by-Step Adaptation Plan for Sellers
Step 1. Assess readiness: analyse metrics (repurchase rate, return on advertising spend, price dynamics), and ascertain the existence of a unique selling proposition.
Step 2. Choose a niche/platform: focus on low-competition categories (such as fur coats), and study case studies.
Step 3. Optimise costs: review tax structures, refrain from 'grey' schemes, and establish direct supply from factories (negotiations, contracts).
Step 4. Continuous analysis: monitor repurchase rates, logistics, advertising, and competitor prices — everything changes.
Step 5. Manage inventory: eliminate non-moving products, test new items in small batches, and scale successful ones. Actively promote initial sales to build momentum.
Particularities for Niche Sellers (Illustrated by the Open Oil Market B2B Fuel Marketplace)
In B2B niches such as fuel, competition may be lower, but certification, logistics, and direct sourcing are necessary. Showcase metrics: turnover, margin, customer lifetime value, and customer acquisition cost. A roadmap of tests → scaling — builds trust. The average transaction value is high, with a focus on retention.
Common Mistakes and How to Avoid Them
Mistake 1. Ignoring price undercutting: do not neglect value aspects (quality, service) — you risk being lost in the race.
Mistake 2. Relying on 'grey' schemes: the market is becoming more regulated, and blockages are inevitable.
Mistake 3. Manual accounting: without analytics (every pallet is a 'trap'), you lose control. Prepare, communicate with the platform, and conduct tests.
Alternatives and Combinations
A dedicated website + search engine optimisation, B2B platforms, and direct contracts. Grants (from the Industrial Development Fund). Combine: marketplaces for testing, independent channels for scaling.
Market Prospects in 2025
The market is consolidating: leaders with analytics, compliance with norms, and product listings evaluated based on AI. Blockchain for tracking supplies will revolutionise supply chains. Success lies in numerical data, adaptability, and a community of sellers. The survivors are those who count every penny and evolve in a timely manner.
