Marketplace Commission vs Zero Commission — The Real Numbers

Marketplaces promise scale.
Own stores promise margins.

But the real question Indian sellers ask is:
“Is zero commission actually more profitable—or just marketing talk?”

Let’s break this down with real numbers, case-style examples, and a clear break-even analysis so sellers can make smart decisions—not emotional ones.

Understanding Marketplace Commission in India

Most Indian marketplaces charge sellers:

• Commission: 10%–35% (category-based)

• Shipping & logistics fees

• Payment gateway fees

• Return & RTO costs

• Visibility costs (ads, deals, boosts)

On paper, commission looks small.

In reality, total cost per order is much higher.

Zero Commission Own Store: Cost Breakdown

Now let’s look at the same ₹1,000 product sold on your own store.

Own store costs:

• Payment gateway (UPI/Cards): ₹20–₹25

• Shipping: ₹70

• Platform + tech costs (averaged): ₹20

Total selling cost: ~₹115

Seller outcome:

• Revenue received: ₹885

• Cost: ₹500

• Profit per order: ₹385

That’s nearly 2x profit per order.

Break-Even Analysis: When Does Own Store Win?

Marketplace:

• Profit per order: ₹120–₹200

• No customer ownership

• No repeat leverage

Own Store:

• Profit per order (after ads): ₹200–₹350

• Customer data owned

• Repeat orders = near-zero marketing cost

Break-even insight:

If even 30–40% customers reorder, your own store becomes far more profitable than marketplaces.

Why Marketplaces Still Matter

This is not an “either-or” decision.

Marketplaces are good for:

• Discovery

• Volume

• New customer acquisition

• Early-stage validation

But relying on them alone caps growth.

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