How much does it cost to build a marketplace website?

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Statistics show that over 80% of global shopping happens online. On the B2B side, 63% of e-commerce business flows through marketplaces, according to Forrester. In 2021, eBay alone had a market cap of $47.8 billion, and by far, it’s not the most popular platform.

So how much does it cost to build an online marketplace website in 2022? To answer this tricky question, we have prepared a detailed guide to the step-by-step process of marketplace development

In this post, we’ll go through the main factors affecting the final cost of a completed solution. To be more specific, we will explore software developers’ hourly rates depending on location. In addition, you will learn how to choose the right tech stack.

What about mobile? How much does it cost to develop a marketplace app? Well, we will cover the costs of mobile app development for the marketplace and help you to decide on its features, too.

We believe that this guide will shape your expectations regarding building a custom marketplace.

Rating of e-commerce companies by market cap
E-commerce companies’ market cap

Syndicode’s experience in building online marketplaces

Unlike off-the-shelf solutions, building an online marketplace from scratch gives you more control over features. Thus, you can reduce the marketplace website development cost for your project and scale as soon as you’re ready. What’s more, a custom solution provides a unique CX that reflects positively on ROI.

Syndicode has substantial experience in turning ideas into revenue-generating marketplaces. Our approach is based on careful planning, clear communication, smart technology choices, and extensive quality control. Our ideas have proven very effective for our clients.

For instance, Hlprs is a platform for hiring house servicemen. The Syndicode team has built a 100% automated marketplace for them and eliminated a large part of manual work. Thanks to our use of heavy-weight technologies, the company’s order flow has grown by 1000%, and order processing has become three times faster.

Hlprs – a household services platform
Household services marketplace developed by Syndicode

Another example of our successful cooperation is Fuzu, a known African startup. Working on the website functionality, we used best Finnish practices. As a result, Fuzu gained 70,000 unique users in a year and is currently the largest job offers provider in East Africa.

Fuzu – African job search platform
A Job marketplace developed by Syndicode

In the hospitality sector, we worked with Hotel Cloud, a US provider for hotels and apartment rentals. Syndicode engineers have developed a principally new UI for the admin dashboard that simplified the employees’ day-to-day work. We also came up with a unique technical solution to enable ten existing platform integrations and leave room for more.

One more favorite is Movinga, a relocation service. We delivered them full-stack development services, including the web app architecture, adaptive UX/UI design, and API back-end. With Syndicode, the company launched its MVP from scratch in just 9 months. Further, our automation solution reduced customer support costs by 93%. Eventually, Movinga exited for €15 million.

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What do you need to know about marketplace website development costs?

So, how much does it cost to build a marketplace website from scratch? Well, depending on the marketplace type and features, the full cycle of development from business analysis to deployment can take 3000 hours and more. 

Subsequently, the final marketplace development cost for a custom-built website can start at $100,000 and depends on a number of factors. We’ll discuss these later in this post, but first, here are the fundamentals of software development regarding cost estimations:

  1. No initial estimate can be precise. It largely depends on the project’s details which are worked out during the discovery session. In custom development, you often have to build something to see what it takes and make further estimates more precisely.
  2. Cost isn’t the most important factor when choosing an IT vendor. Well-oiled software development processes and clear communication eventually turn out to be more cost-effective than a cheaper option.
  3. Software development is a creative process. Most often, there isn’t one right way to implement functionality. All the code is hand-crafted and takes skills and creativity to  develop the best solution in terms of performance and resources.

The Cone of Uncertainty concept perfectly illustrates how precision depends on the amount of research and planning:

Cone of Uncertainty
Estimations accuracy depend on several factors

As you can see from the graph, the importance of the discovery phase is tremendous in marketplace development. Not only does it help to give a realistic answer to the questions, “How much does it cost to build an online marketplace?” and the project timeline, but it also ensures payability, reducing the room for error and cutting time to market.

Types of online marketplaces 

Before you can build an online marketplace, you should decide on the type that will work best for your goals. Each marketplace type is better suited for a particular audience. The number and complexity of essential features vary, which affects the marketplace website development cost. Also, depending on the chosen type, you’ll have different monetization strategy options.

If we start exploring the marketplace topic, we cannot but mention Amazon. Not taking into account all the additions to the original Amazon website, it is a B2C horizontal marketplace where customers can find any kind of product. So how much does it cost to build a marketplace website like that?

In the table below, you can see the main stages of Amazon marketplace development and the average possible cost ranges.

Development stageEstimated cost
Business analysis$10,000–$22,000
Design$5,000–$14,000
Back-end$39,000–$116,000
Front-end$25,000–$75,000
QA$14,000–$62,000

Amazon uses a vast amount of technologies, some of them unique and hard to replicate (like their one-click ordering). In the most simplified form, a similar marketplace would have features like those shown in the table below. We’ve made estimates regarding an Amazon-like marketplace website development cost, assuming a standard team of four units working on the project.

Basic features

ItemEstimated cost
Authentication & authorization$5,000–$21,000
Profiles (host, guest, admin)$18,000–$25,000
Product pages and other landings$10,000–$14,000
Search and filters$15,000–$20,000
Shopping cart$12,000–$17,000
Payment system integration$15,000–$20,000
Customer reviews$12,000–$18,000
Email notifications$10,000–$20,000
Total cost of a basic marketplace version$97,000–$155,000

Advanced Amazon features

Wish Lists
$5,000–$10,000
Product comparison$10,000–$16,000
Messaging system$10,000–$20,000
Geolocation$10,000–$16,000
Supplier admin panel$10,000–$16,000
Reporting (CRM integration)$10,000–$16,000
ML-powered product recommendations$10,000–$40,000
Total cost of full-featured product$162,000–$289,000

For comparison, how much does it cost to build a marketplace website like Airbnb? 

Airbnb is a P2P vertically integrated marketplace where people looking to find accommodations connect with those wanting to rent out their homes. According to our estimates, the marketplace website development cost, in this case, would include:

Development stageEstimated cost
Business analysis$10,000–$20,000
Design$4,000–$11,000
Back-end$32,000–$90,000
Front-end$21,000–$58,000
QA$13,000–$45,000

Basic features

ItemEstimated cost
Authentication & authorization$5,000–$21,000
Profiles (host, guest, admin)$18,000–$25,000
Homepage & landings$8,000–$10,000
Apartment details$2,000–$4,000
Search and filters$15,000–$20,000
Email notifications$10,000–$20,000
Customer reviews$12,000–$18,000
Geolocation$10,000–$16,000
Total cost of a basic marketplace version$80,000–$134,000

Additional features

Wish Lists$5,000–$10,000
Payment system integration$15,000–$20,000
Messaging system$10,000–$20,000
User verification$10,000–$20,000
Total cost$130,400–$224,000

As you see, while both Amazon and Airbnb are online marketplaces, they work for different purposes. Hence, they have different functionality and features. 

And, of course, the marketplace website development costs differ for these two platforms, ranging between $97K–$289K for a website having Amazon-like functionality and $80K–$224K for an Airbnb counterpart.

Another component of the answer to the question, “How much does it cost to build an online marketplace?” is the marketplace classification:

By participants

Depending on the target audience for your online marketplace and the intended nature of the seller-buyer relationship, your marketplace can be one of the following:

  • B2B marketplaces sell products or services in bulk and are usually operated by a third party. Their idea is to automate the selling/buying processes and improve deal transparency. Common monetization models include commissions, subscription fees, or listing fees. Example: Alibaba, eWorldTrade.
  • B2C marketplaces provide an opportunity for businesses to sell directly to customers. They are popular since customers can find a variety of goods in one place. Like B2B, B2C marketplaces are usually monetized through commissions, subscription fees, and listing fees. Example: AliExpress, Booking.com, Bonanza.
  • P2P or C2C marketplaces connect individuals to share products and services in exchange for money or other products and services. They aim to help people make optimal use of resources through second-hand buying or rental. This marketplace type can be monetized through paid promotions and advertisements, and the cost to develop a peer-to-peer marketplace can exceed average numbers. Example: Etsy, Uber, BlaBlaCar.
  • eCommerce marketplaces enable businesses and individuals to sell their products and services to multiple buyers. The buyers can be individuals or companies. Given the broad audience, this type of marketplace is popular, reflecting the eCommerce marketplace development cost. Example: Amazon, OLX, Poshmark. 
  • mCommerce or mobile marketplaces are digital stores designed with the mobile-first approach in mind. They aim to simplify mobile shopping. Monetization happens due to commissions, subscription fees, freemium plans, listing fees, and lead fees. Example: Upwork, Jumia, Sephora.
  • Crowdfunding marketplaces let members raise funds from the masses for a particular project. Possible monetization strategies involve commissions and transaction fees. Example: Kickstarter, Indiegogo, GoFundMe.
  • Auction platforms encourage sellers to compete for the product or service by bidding. Auctions are an excellent way to get the most competitive price for an item. Auction marketplaces earn money through transaction fees. Example: eBay, Honcho, Artsy.

By business model

A business model defines the structure your marketplace will use to attract buyers and sellers and the means of getting revenue. It also determines the necessary functionality and affects the marketplace website development cost. Online marketplace business models are categorized into three groups:

  • Vertical marketplaces are focused on niche products and services instead of selling everything to everyone. Being dedicated to a specific category, you experience less competition, improve the quality of products and services, and provide better personalization. Example: Airbnb, StockX, TrueFacet.
  • Horizontal marketplaces sell products in different categories to different buyers. These are a one-stop-shop, meeting all kinds of customers’ needs. The main benefit of a horizontal marketplace is a vast audience driving more transactions. On the contrary, the competition is fierce. Example: Etsy, OLX, Poshmark.
  • Global marketplaces allow the exchange of goods and services regardless of users’ geographical location. A global marketplace has the broadest audience hence the revenue potential. You can also diversify your business’s markets by going global. However, you should be ready for legal constraints and language barriers. Example: Amazon, eBay, Upwork.
Want to build a marketplace like Amazon?
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Tech Stack for Online Marketplace Development

You have determined your marketplace type and monetization model. Naturally, your text question will be as follows: how much does it cost to build a marketplace website of chosen type? To provide you with some information, we will discuss the tools necessary for its development. Tech stack constitutes a significant part of a marketplace website development cost.

An adequately chosen tech stack allows implementing the desired functionality while keeping the cost of developing an online platform to a minimum. At Syndicode, we carefully select a custom tech stack for each project to make software that best fits our client’s needs. We emphasize loading speed, ease of scalability, and updating. Our team also ensures the shortest time-to-market possible, thus reducing the marketplace development cost.

Tech stack for a marketplace website development
Marketplace website development

A marketplace website tech stack consists of back-end and front-end.

  • Back-end tech stack 

The Syndicode team uses Ruby, JavaScript, PHP, or Python, supported by corresponding frameworks to create website logic. For client requests management, we rely on SQL Server and MySQL, PostgreSQL, and some other databases.

  • Front-end tech stack

To create stellar user interfaces and clear internal structures, Syndicode developers use HTML, CSS, JavaScript, and TypeScript where necessary. These are accompanied by libraries like jQuery, React, or Vue.

To create a robust UI, we choose between ReactJS and Vue.js technologies. Each has its benefits and drawbacks that we juggle to handle specific tasks.

For quality assurance (QA), we combine manual and automation testing tools. This way, we can perform tests on different environments from the very beginning of the project. It helps improve software quality, timely detect bottlenecks, and evaluate software behavior.

How much is an hour of work for a marketplace developer in different parts of the world?

Now, let’s return to the question, “How much does it cost to build a marketplace website?” Apart from the chosen marketplace type and website features, the location of your tech team also affects the marketplace website development cost.

In the table below, we’ve outlined the average rates of web developers worldwide. Thus, US developers are the highest paid in the world. They are great in coding and programming and, for this reason, are readily hired locally. 

Programmers from Western Europe have solid skills and are in high demand for outsourced software development projects. Yet since 2020, EU engineers’ salaries have been creeping up, making businesses search for other options. 

Eastern Europe has hit the top 20 list of the world’s best developers and has been recognized as the top choice in numerous rankings. Eastern European developers are highly expertized and show great performance.

Indian rates remain the lowest, while Indian developers’ skills are considered a matter of luck. Furthermore, the language barrier can be an issue. Also, India is twelve hours ahead of the center of the U.S., which further complicates communication.

Software engineer’s hourly rate in different countries in 2022

CountryAverage hourly rates
US$120-$170
Western Europe$75–$100
Eastern Europe$45-$75
India$25–$45

What can affect the marketplace app development cost?

Eight out of ten people shop online using a mobile device. So, if you want to be competitive, building a marketplace application is out of the question. But how much does it cost to develop a marketplace app? 

Just like with the question, “How much does it cost to build a marketplace website?” there is no one answer. Marketplace apps vary in size, type of products, how they promote themselves, and so on. All these determine the necessary functionality for the app and the number and complexity of features.

Further, your marketplace’s audience consists of buyers and sellers. They perform different functions, and thus, you have to build a marketplace app with separate interfaces. A buyer profile will give access to the product catalog, inventory management, pricing, bidding, shipping tools, and the ability to create their returns policy (or accept the platform’s terms).

A seller profile should have search functionality, recommended items, review and compare tools, add-to-cart opportunity, and access to payment options. Depending on your marketplace type, you will need additional features like reviews and ratings, push notifications, social media integration, etc. They will add up to the final marketplace app development cost.

Marketplace app development process
The components of the marketplace app cost

Core features of a marketplace application and website

As you already know, the answer to the question, “How much does it cost to develop a marketplace app?” and/or website lies in the type of marketplace, its purpose, and your needs. However, certain functionality is essential for an app to perform like a marketplace. Here are the core features that also make up the ​​marketplace app cost:

  • Registration and sign in

A means for newcomers to start using your platform and for registered users to list products and services or search for them. The simplest and hence the cheapest method is the manual input of email and password with further confirmation through a link in an email.

You may choose multi-factor identification, which increases security but requires more work in terms of development. Or you may simplify the registration process for a user by implementing a social login function, which requires integration with Google and social platforms.

Social sign-up function
Social sign-up at Fuzu
  • Profiles

This is where users list information necessary to use the marketplace. For a seller, it’s their business name, product listings, shipping and payment information, etc. For a buyer, it’s personal details such as name and shipping address, a wish list, and a list of previous orders.

To add personalization, you may enable profile photo uploading, a bio section, or even an opportunity to change the design of a user’s personal page. Depending on how many things a user can do in their profile, the marketplace development cost will go up or down.

Fuzu profile customization
Multi-featured profile at Fuzu
  • Item listing

The list of products visible to users that sellers can add to or delete from. In other words, a seller’s virtual storefront, where users can browse goods from the same company. The item listing design and what exactly a seller can do with it determine the marketplace app cost.

Thus, you may demand the opportunity to upload videos with automatic formatting, change the listing view, add breadcrumbs for better navigation, include social sharing buttons, and more.

  • Search

Makes navigation through the item listing easier, letting buyers review specific items or categories. The search field’s intelligence, number, and complexity of filters influence the marketplace app development cost.

For instance, you can go with a basic search field with filters or equip it with autocomplete that will guess the user’s intent and offer more specific suggestions for their query. A faceted search software will provide even better UX and increase the price of development.

Intelligent search feature
Example of a faceted search
  • Product page

Provides extensive information about the product. Since customers can’t touch the item as they would in an offline store, you should build a marketplace app featuring high-quality visuals and detailed descriptions.

Again, you may want to add videos, GIFs, or even 3D models of a product so customers can turn it around before buying. Complementing your product pages with other features like customer reviews, live chat, or related products will boost customer engagement and raise the marketplace app cost.

  • Shopping cart

Contains the products chosen by a buyer but not purchased yet. Here, a customer can change the number of items, delete them, view shipping options, prices, and related info. The shopping cart may have different functionality, which affects an e-commerce app development cost.

For example, a shopping cart can come in a mini version or a full page — or both. Then the checkout process can be displayed on a single page or take a user through a step-by-step procedure. Help elements and live support availability also increase the development price.

Amazon’s shopping cart
Example of a mini-cart
  • Payment

Here, buyers check out the available payment options, choose payment gateways, add card information, etc. Usually, marketplaces offer several payment methods: PayPal, Google Pay, Apple Pay, American Express, etc. The integration of each costs extra.

  • Administrator panel

An admin panel is necessary for a business owner (you) to customize marketplace settings like shipping and payment methods, policies, etc. You should also be able to edit categories and search filters. How much you can do as a marketplace administrator defines the final marketplace app cost.

For example, an admin can just manage the marketplace content or have access to statistics. User content can go straight to publish or first be moderated. The same is true for user registration. The number of admins also affects the complexity of the admin panel architecture, thus increasing the development cost.

  • Shipping

This option lets buyers review and choose suitable delivery options. There are many ways to connect your marketplace to a shipping solution, which is one more reason why marketplace app development cost varies.

Also, you can choose a shipping integration that shows carriers’ rates in real-time or deliver locally. For the latter, you’ll need a geolocation feature that will determine a customer’s location to then help with shipping costs calculation. All this will add up to the final sum.

Killer features of a marketplace app

How much does it cost to build an online marketplace application having all the cool features?

We get you, core features ensure the basic functionality of your marketplace app, yet you need something else to stand out from the competition. To get a piece from the online marketplace industry’s pie, you should develop a unique growth-driver feature. And that’s one more factor to consider when researching how much it costs to develop a marketplace app. 

Here are some ideas to get you started:

  • AR technology

AR is the trending feature letting customers evaluate the item’s look before purchase. The feature is viral among furniture manufacturers, suppliers, and retail. However, it can substantially increase the marketplace app cost for development.

  • Voice search

More than 30% of internet users performed a voice search. This feature hasn’t been disseminated through marketplaces yet, so you can use it to get ahead in the competition.

  • Ratings and reviews

Implementing reviews functionality in your marketplace app will give buyers insights into the product or service quality and promote trust in your marketplace. Using ratings, you can also better position the sellers on your platform.

  • Wish List

Allows buyers to save products they have considered purchasing. Enabling wish list sharing among the user’s friends boosts engagement and drives more traffic to your platform. This feature will somewhat increase your marketplace app cost, yet it gives you lots of user data.

  • Messaging

That’s where sellers and buyers can discuss products and services and associated information. The chat may allow media files exchange and pre-made templates for more efficient communication.

How much does it cost to develop a marketplace app from scratch?

If you’re wondering about specific numbers, the table below shows the estimated range of a custom marketplace app development cost. Of course, the costs vary depending on the app’s complexity. 

Thus, a simple custom marketplace app will have basic functionality, including the seller and buyer profiles, admin panel, search system, product page, shopping cart, payment gateways, and messaging system. Such an application takes around 900 hours to design and code. 

With a standard team of a business analyst, project manager, UI/UX designer, two developers, a QA specialist, and a DevOps engineer, the answer to the question, “How much does it cost to develop an app?” will be at least $70,000–$118,000 for one platform.

 In our other blog post, we have described the mobile app development process step by step.

How much does it cost to develop a marketplace app with moderate complexity? An app with analytics, order tracking, and product recommendations will cost a minimum of $90,000. And if you want a complex app with a wide range of functionalities, including location sharing, virtual placement/try-on, voice search, etc., the marketplace app development cost may vary from $150,000–$280,000 and higher. 

Worth noting that a cross-platform mobile app generally costs 1.5 times as much as a native iOS or Android application.

Basic features of a marketplace app

ItemEstimated cost
Authentication & authorization$5,000–$21,000
Profiles (buyer, seller, admin)$18,000–$25,000
Product pages and other screens$10,000–$14,000
Search and filters$15,000–$20,000
Customer reviews$12,000–$18,000
Notifications$10,000–$20,000
Total cost of a basic marketplace app$70,000–$118,000

Additional marketplace app features

Shopping cart$12,000–$17,000
Payment system integration (1 system)$15,000–$20,000
ML-powered product recommendations$10,000–$40,000
Geolocation$10,000–$16,000
Shipping$10,000–$20,000
Virtual placement/try-on$16,000–$30,000
Photoshopping$10,000–$20,000
Total cost of full-featured product$153,000–$281,000

The reasoning behind the pricing revealed

Generally, the answer to the question, “How much does it cost to build a marketplace website?” can be as follows. The cost of marketplace development is affected by industry, target audience, and marketplace type. The considered features are an example of an average website and marketplace app’s functionality. 

You may find the basic features set enough or need to extend the list, thus increasing the development price tag. Thus, a custom marketplace development can cost you $80,000–$289,000, depending on the marketplace website development cost components. We also covered how much to develop a marketplace app, and it’s $70,000–$281,000 and higher.

Having to do the preliminary research, decide on functions, marketplace elements interaction, and associated things might seem like a lot. Yet, the Syndicode team can unburden you with full-cycle custom software development services. Our case studies and 100% positive client reviews prove our expertise in building automated marketplace systems that optimize clients’ investments and expand business reach.

FAQ

  • The answer to how to create a marketplace website is simple. There are five basic steps: Come up with an idea and validate it A viable marketplace idea should solve a problem for both the customer and the seller. At Syndicode, we always start with business analysis to understand current issues in the industry and identify potentials. Decide on your marketplace type and business model Knowing your marketplace type will help you define the potential buyer base, choose the most appropriate monetization strategies and avoid extra investments in website and app development. Determine the functionality of your future marketplace Depending on your goals and budget, you can go with the minimal set of features or expand them to maximize your competitiveness. Remember that the chosen functionality set defines the final marketplace website development cost. Choose a tech team to implement your project A wise choice results in higher marketplace website quality, less need for maintenance, shortened time to market, and reduced costs. Launch your marketplace and start achieving your business goals To ensure the successful launch of your new online marketplace, you should test it to eliminate any chance of malfunction. Don’t forget about marketing to encourage users’ flow from the very first days.

  • The times for custom marketplace development vary. Depending on the marketplace type, business model, and features, creating a marketplace website from scratch may take four to six months. In the case of a complex marketplace platform like Amazon, the web development process may take twelve months or more. This time involves information collection, business analysis, planning, design and prototyping, coding, and testing. At Syndicode, we start by presenting the methodology and work processes chosen for your project. This ensures everyone is clear about deliverables and the estimated development time frame.

  • To answer the question, “How much does it cost to build a marketplace website?”, we need to know the desired complexity of the platform and your tech partner’s location. Thus, if outsourcing your marketplace building to a team from Eastern Europe, the estimated marketplace website development cost varies between $80K–$289K for a fully featured product. The cost of building a marketplace website increases if done by engineers from Western Europe: expect to pay around $130K–$570K for a simple solution. And US developers will charge between $240K–$820K since their rate is three times as high as one of the Ukrainian software companies. If you’re curious ​​how much it costs to develop a marketplace app, the price tag for this depends on the app’s functionality. Again, depending on where your software development team is located, marketplace app development costs for a simple solution can go from $80K–$280K and more.

  • Syndicode is a software development company specializing in building custom marketplaces from scratch. We do a full-cycle development, starting with brand identity, to design and development, to the fully featured product and its maintenance. The accumulated experience allows us to approach each new project with a clear plan and established processes. We believe that effective communication is the pillar of quality marketplace development. Therefore, we hold a discovery session at the beginning of the work to collect all the information about your industry, business, and vision. Next, we perform business analysis to assist you with ideas that best fit the current market. By 2022, we have created over 140 successful solutions. Many of our marketplace projects have paid off in six months after launch. After working with us, our clients have increased their revenue flow, removed handicaps for business growth, and started providing an enhanced UX to their customers.

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