Top 3 Marketplace Distribution Challenges and How to Overcome Them

Introduction

The wholesale sector faces distribution challenges that have never been seen before at this pivotal time in its history. Wholesalers and distributors have always played a significant role in the sale of products by serving as middlemen between producers and end users and ensuring that the products arrive on schedule. However, this is starting to change.

Manufacturers and retailers are progressively investing in their distribution networks to cut out the middleman and provide products directly to consumers and shops through the E-Commerce marketplace. These distributors thus need help to hold onto their market share and preserve profitability.

In this article, we will examine the challenges distributors are having in the modern era and offer advice to distributors on how to succeed in marketplace distribution in E-Commerce operations.

Marketplace Distribution

What technology is behind the E-Commerce operation? The majority of well-built, high-quality E-Commerce software available today will help online retailers utilize the marketplace distribution strategy. With this strategy, you are free to market and sell your products through a sizable online marketplace operated by a third party.

In essence, you could export your products for online sales. You can immediately use this strategy to sell your company if you run a product-based business. E-Commerce marketplace distribution is a fantastic approach to expanding your company. It helps merchants succeed in every phase of their E-Commerce operations.

The visibility of your brand or company can be increased by distributing products to E-Commerce marketplaces. The difficulty with this strategy may be the intense degree of competition. Your products will be shown next to those of several other brands, both large and small.

More prominent, more well-known brands might have an advantage in this scenario. Small and midsize firms that still need to establish their brands need help with pricing, finding new clients, and brand equity, among other things.

Even yet, you should play this hand because most marketplace distribution platforms allow posting for free and only charge a small proportion of sales. Any additional exposure you can provide your online store may attract the attention of your target market and generate significant profits.

How can SMB owners position themselves better than their competitors in the marketplace distribution model? The key to success is developing products that genuinely benefit customers while developing inventive marketing schemes.

If you succeed in doing this, you will rapidly stand out from the crowd of competitors. Growth Jockey can help you to keep up with the latest industry trends.

Importance of Marketplace Distribution

Using a distribution channel plan, you can optimize the distribution channels that your products use to get from your company to final consumers. Maintaining your distribution plan is essential since it can impact how well you satisfy your customers.

The product goes through several stages before reaching the consumer, starting with the manufacturer, distributors, and marketplace 360, including wholesale or retail markets.

The manner things are delivered to clients will improve their overall experience. Your distribution channel management must be optimized.

Spending a lot of time on distribution channel plan optimization indicates that you are passing up a chance. But what problems does distribution channel management optimization face? The top 3 distribution problems are shown here, along with how to overcome challenges in E-Commerce.

How does marketplace distribution work?

A wholesale distributor acts as a middleman between the producer and the store. When a wholesaler uses drop shipping, the drop shipping sellers will instruct the wholesaler on how to ship the products to the final customers.

These days, some distributors could work for the same firms as the producers. There could be alliances between manufacturers and other distributors.

Purchasing in-demand products at a discount is the "main idea" underpinning wholesale distribution. Most of the time, manufacturers need more means or channels to sell many products. Because that's how they make their money; after all, high volume can be accomplished at low prices.

Wholesale distributors can frequently negotiate better manufacturers' prices by purchasing bulk products. They can approach wholesale distributors, offer them competitive prices, and sell their items to them in bulk at once rather than spending time, money, and effort attempting to market their products.

Wholesale distributors are skilled in selling to retailers for a little bit more money while keeping the difference in profits.

How to overcome marketplace distribution challenges?

Growth Jockey have collaborated with numerous associations of wholesale distributors and discovered that no one is ever alone. Although the final products may vary, your distribution problems are frequently the same. Growth Jockey focusses on the issues that we often encounter in the sector in the following parts.

Inventory management

Inventory management is a crucial component of any organization that gives information on the stocks coming in and going out of your company. For continuous, quick, and effective operations as a distributor, you must be aware of the stock availability and running out at all times.

Previously, inventory was controlled in a small room with manual stock management. Still, to compete in the E-Commerce era, it became ineffective.

Knowing the real-time, complete view of the supply chain, logistics, and stock levels are essential for distributors. The warehouse personnel can check stock availability when reordering. Still, it is vital to locate the inventories precisely for efficient operations. Hence, the importance of an advanced inventory management system.

GrowthJockey's Solution

This is where a backend system that accurately tracks all inventories is required. ERP for distribution aids in warehouse management. It keeps tabs on stock availability and continuously updates the in and out of stock in the cloud in real time.

This program is robust, allowing for the best resource usage, and is cost-effective. It streamlines manual processes and accurately controls inventory. It enables you to keep track of your company's stock no matter where you are.

You may estimate and assess the monthly stock requirements for your company using a modern inventory distribution management system that incorporates artificial intelligence, which will assist you in managing inventory appropriately.

Shipping errors

Customer loyalty is something that businesses should strive to achieve through excellent customer service. In turn, your company receives more referrals as a result.

However, offering the best customer service in an online store only takes a few clicks. A significant point of differentiation for contemporary distributors is now this.

Reduced shipping errors and proper order fulfillment are two of the distributors' most significant problems. Delivery mistakes can take many forms, including incorrect shipping details, product shortages, and damage, picking errors, warehouse faults, labeling issues, and ordering mistakes.

This issue occurs manually updating critical operational parameters, resulting in subpar customer service. The company must monitor the inventory, warehouse management system, logistics, and order information.

How GrowthJockey solves this problem

You may stay current on these facts in a single platform in the cloud with the help of the best distribution Enterprise resource planning [ERP]. You can deliver superior customer service and maintain client relationships with the best distribution ERP. Doing this can minimize returns of your goods or services and shipping problems.

Complexity in handling orders

Keeping track of all the incoming orders from each platform when you sell on numerous marketplaces can take a lot of work. You can miss out on orders and sales since it might be difficult to manage different marketplace dashboards when you have orders pouring in from many marketplaces.

This will result in a delay in processing orders and, in the worst case, a penalty from the marketplace, which will harm your seller privileges and scoring.

GrowthJockey's Solution

A marketplace order management system does not require manual data entry since orders are synchronized across all sales channels when anything is sold. Instead, orders are compiled into a single dashboard from all supported marketplaces.

The appropriate marketplace logos will show up in the admin area once an order has been received from the marketplace. By managing your orders and identifying your customer base, you can prevent order processing mistakes and pointless duplications.

You can even fulfill all orders in bulk by using some E-Commerce platforms' mobile apps, which offer real-time order alerts. With this bulk-fulfillment tool, you can reduce human error in the order-packing procedure.

Keeping track of all the incoming orders from each platform when you sell on numerous marketplaces can take a lot of work. You can miss out on orders and sales since it might be difficult to manage different marketplace dashboards when you have orders pouring in from many marketplaces.

This will result in a delay in processing orders and, in the worst case, a penalty from the marketplace, which will harm your seller privileges and scoring.

Conclusion

For a successful E-Commerce marketplace distribution, there are as many challenges in distribution operation, and there are solutions. If you closely examine the patterns, you'll see that the problems in operations of E-Commerce encountered during the development of E-Commerce have mostly stayed the same.

Suppose you employ strategies like target marketing, continuous improvement, a customer-centric approach, and striking UX design. In that case, your market will stand out from your competitors.

Adopting eCommerce marketplace distribution is a chance in various methods that promise increased revenue. However, these possibilities still need to eliminate E-Commerce challenges for a business. With the proper solutions or feature-rich technology, managing your current business, and foraying into e-distribution, is much easier.

Utilizing the right technological solutions will make you stand out to businesses for exciting chances and make customers want to shop with you.

Want to learn more about being a successful e-distributor with brands and customers? Growth Jockey is here to help.

At Growth Jockey, our sole focus is on creating custom solutions that address the unique challenges faced by our clients in the e-commerce industry. We are committed to helping businesses of all sizes, from small-scale enterprises to large corporations, harness the power of technology

Get in touch with us today to scale your business with our expert solutions !