Sell on a marketplace when you need traffic and proof of demand fast and your margin can absorb a double-digit commission; sell through your own store when your margin is thin, your product needs explaining, or the real business is in repeat purchases and accessories. Once the product is finished and the first pallet is in the warehouse, this decision drives a large share of your profitability — and the honest answer for most new products is a sequence rather than a choice. At Projects House we run into this question during engineering, because the sales channel has direct consequences for packaging, weight, and target unit cost.
What a marketplace gives you that your own store cannot
The big advantage is existing traffic. A buyer with a problem types it directly into the marketplace search bar, and you appear in front of them without having spent a dollar building an audience. Alongside that come platform trust, working payment and returns infrastructure, and often warehousing and fulfillment as a service. For a new product this is a comparatively cheap way to test genuine demand, which is why launching on a marketplace is a common opening move; the fulfillment side of it is covered in our guide to selling a product through Amazon FBA.
The cost is structural: the platform owns the customer relationship, controls the page format, and can change the rules. You are also one row in a comparison grid, which puts constant downward pressure on price.
What your own store gives you that a marketplace will not
- Margin. No double-digit selling commission. The money saved goes straight into advertising or product development.
- Customer data. Email address, purchase history, and permission to contact them again — instead of a customer who belongs to the platform.
- Brand and explanation. Story, video, full technical detail, comparison tables. Not a uniform template every competitor also uses.
- Expansion. Bundles, consumables, spare parts, subscriptions, and service plans — all difficult or impossible to run inside a marketplace listing.
- Price control. No permanent race to the bottom against anonymous sellers on the same page.
What decides the outcome in practice is the quality of the sales page itself. A page that converts can double results with no additional traffic, and the same discipline that makes a marketplace listing work — described in our notes on writing a listing that converts — applies to your own product page.
How the numbers actually compare
The simple framing: on a marketplace you pay in commission, in your own store you pay in traffic acquisition. Marketplace selling fees typically run from a few percent to something approaching a fifth of the sale price, with storage and on-platform advertising often added on top. Your own store's transaction fees are far lower, but paid customer acquisition can easily exceed that same percentage — and unlike a commission, you pay it whether or not the visitor buys.
So the comparison has to be made on net profit per unit, not on the headline fee, and it requires understanding your whole cost chain, as discussed in our guide to pricing a product. Two useful rules of thumb: if your gross margin is below roughly half the selling price, a marketplace will eat the profit; and if explaining your product takes more than a few seconds, you need a stage of your own. A realistic view of the promotional spending either route implies is laid out in what it costs to market a new product.
The combined model, and the order to do it in
The practical answer is usually both, in sequence. Most founders who succeed do not pick one channel: they start on a marketplace to validate demand and accumulate reviews, while simultaneously standing up a site that begins to build organic traffic. Once the product has proven itself, they gradually move repeat customers and higher-margin variants to the owned store, leaving the marketplace to do the job of discovery.
If the target buyer is a business rather than a consumer, the picture changes entirely — specification sheets, quotes, purchase orders, and distributor relationships matter more than either channel above. Read our overview of the B2B sales process for a physical product before investing in a consumer channel that will not fit.
What this means for the engineering
The channel decision comes back to the design table:
- Package volume drives fees. Marketplace fulfillment programs price storage and shipping by size and weight, so a more compact package improves profit directly.
- Return rates are higher online. That justifies investment in protective packaging and unambiguous setup instructions, both covered in our article on product packaging design.
- Flat-pack cuts volume but adds complaints if assembly is at all confusing.
- Labeling requirements differ. Marketplaces mandate standard barcodes and image specifications; in your own store you set the rules.
These are exactly the considerations we build into the product documentation early, alongside the rest of the material collected on our selling your invention page. Retrofitting packaging after the channel is chosen is one of the more avoidable costs in a product launch.
Design the product for the channel you chose
Projects House develops products with the sales channel in view — from package geometry to target unit cost. Contact us through the form and we will go over the full picture with you.