In a thriving marketplace, vendor satisfaction is as important as customer satisfaction. A successful platform considers both stakeholders, providing seamless experiences.
What makes a happy vendor? First and foremost: getting paid. No vendor will be satisfied if they’re unclear on when, where, and how they’ll receive their money. That’s why efficient vendor payouts are crucial. Without them, you risk losing valuable vendors.
But, managing payouts can be challenging, requiring more than just a traditional accounts payable approach— it demands a clear process and meticulous tracking.
Let’s imagine the scenario: You get three orders, each including products from two different vendors with different commission agreements. They all need to get paid the appropriate amount in a timely fashion and understand the details of the order. Doing this manually is prone to errors and delays. Now, imagine multiplying that by 10, 100, or even 1,000 and trying to figure out who gets paid what, when — unruly would be an understatement.
This article outlines the process Nautical’s multi-vendor commerce platform uses to automatically ensure vendors' payouts stay on track, including:
Vendor agreements outline the commission structures and are essential for monetizing your platform and calculating payouts.
The first step in managing vendor payouts efficiently is to establish clear marketplace agreements. These agreements, outlining the commission details, dictate how payouts are calculated and the revenue retained by the marketplace.
In Nautical, you have the flexibility to set broad commercial terms for each seller or opt for granular commissions for specific product categories.
Operators can easily manage complex payout structures, factoring in multi-level commission structures and fees. These agreements and commissions can be updated at any time, with commissions adjusting accordingly. The commission is automatically calculated and viewable on each order using the active agreement between each seller and the marketplace.
You don’t want to manually send invoices to accounts payable every time you owe a vendor money. This would require a very big and very patient finance team.
Stripe Connect, integrated out-of-the-box with Nautical, is the recommended method for automating vendor payouts. Sellers simply create a Stripe Connect account using their onboarding link displayed in Nautical and input their banking details, enabling automatic payment processing.
Once a Stripe Connect payout is processed from Nautical, the vendor will receive the payment automatically according to the payout schedule in their Stripe account.
Nautical also allows for manual payment processes, providing options for different operational needs. For example, you could handle the payments to vendors in another system and update Nautical when the payout is complete.
Automation doesn’t equal loss of control. As a marketplace operator in Nautical, you have complete control over when and how to process payouts.
A crucial feature of Nautical's payout system is its ability to track the payout status of each order. Each seller order has a payout status, such as "Ready for Payout," which signifies its eligibility to be included in the upcoming payout batch. This feature allows marketplace operators to easily identify which orders are processed for payment, ensuring no eligible transaction is overlooked.
Before initiating payouts, marketplace operators can preview the commission on each order.
This feature ensures transparency and accuracy in the payout process. Operators can review the calculated commission amounts, ensuring they align with the agreed vendor terms. This preview capability is particularly useful for orders with complex commission structures or when adjustments need to be considered.
Before sending payouts, you can review and adjust them, ensuring accuracy and transparency. Once you’re ready to finalize the payout, you can process the payout in Nautical. This control allows you to make necessary adjustments and manage the payout timeline.
It's essential for vendors to have access to detailed order-level information about their payout. Nautical makes accessing this data easy, which is crucial for transparency and trust.
Sellers receive detailed payout statements, offering a breakdown of each order and the commission calculation. This feature helps vendors understand their earnings and the commission breakdowns, enhancing their experience on the platform.
This level of detail fosters trust and clarity between the marketplace and its vendors.
Effective vendor payouts are a crucial component of a successful marketplace.
This flexibility, coupled with detailed reporting and easy-to-manage vendor agreements, ensures that your marketplace can scale effectively while keeping vendors satisfied and paid on time.
By taking control of vendor payouts with Nautical, marketplace operators can focus on growing their platform, secure in the knowledge that their financial transactions are handled smoothly and accurately.