Marketplace or WhatsApp: A Method for Comparing the Real Margin per Order

A seller of home-made snacks is sure the marketplaces are eating the profit. The deductions on each order are plain to see. So the seller starts pushing customers to order by WhatsApp instead. Six months later the bank balance is no better. An admin has been hired to answer chats, shipping is often absorbed to close a sale, and several orders were sent and never paid. The question of marketplace or WhatsApp has to be answered per order, with every cost on the table, including the ones no statement shows.

A note on figures: marketplace fees differ by platform, category, seller status and programme, and they change often. This article gives a method and an illustration. Put your own numbers in.

The unit: margin per order

Compare the two channels on one typical order of the same product. The number you want is what remains after every cost that the order causes.

Margin per order = selling price, minus cost of goods, minus all channel costs, minus all handling costs.

Seven cost lines for a marketplace order

Take these from a month of real income reports, divided by the number of orders.

1. Commission. The platform's percentage on the sale.
2. Programme fees. Free shipping programmes, cashback programmes, and similar, if you joined them.
3. Payment or transaction fee.
4. Vouchers and discounts you fund.
5. Advertising on the platform. Total ad spend divided by orders.
6. Packaging and shipping you pay.
7. Returns and penalties. Cost of returned or failed orders, and any penalties, spread over all orders.

Seven cost lines for a WhatsApp order

These are harder to see, because nobody sends a statement.

1. Staff time. Minutes spent chatting per completed order, including the chats that did not become orders, times the cost of that time. This is usually the largest hidden cost.
2. Payment fee. Payment gateway or QR payment charges. Zero for a plain bank transfer, with the cost moved to line 7.
3. Shipping subsidy. What you absorb to match the free shipping buyers expect.
4. Discounts given in chat.
5. Customer acquisition. Ads, content and promotions that bring people to your chat, divided by orders. For a repeat customer this may be close to zero.
6. Packaging and tools. Packaging, plus the monthly cost of any software divided by orders.
7. Losses and admin. Unpaid orders, failed deliveries, refunds, and time spent checking transfers.

To measure line 1, time ten real orders from first message to confirmed payment, and count how many enquiries it takes to get one order.

A worked illustration

One product, selling price 100,000, cost of goods 55,000. The channel figures are invented for illustration.

In this illustration the two channels end up the same. The marketplace took 12,000 in fees, and the direct channel spent as much again on staff time, absorbed shipping and smaller items. The seller in the opening story had this outcome and did not know it.

Now change one assumption. For a repeat customer on WhatsApp, acquisition cost falls to near zero and the chat is short: staff time 2,000, acquisition 0. Margin rises to 28,000. The channel is the same and the result is very different.

That is usually the real finding: direct is not better in general. Direct is better for customers who already know you.

Reading your own result

Marketplace margin is higher. Common when your chat process is slow, you absorb shipping, or you pay for ads to bring strangers to WhatsApp. Either fix those costs or accept that the marketplace is your efficient channel.

WhatsApp margin is higher. Common with repeat buyers, larger baskets and customers who do not need persuading. Grow this channel deliberately.

They are close. Then other things decide: where growth comes from, how much risk you carry, and how much of your time each consumes.

Either is negative. A price or cost problem that no channel choice will solve.

What the margin number leaves out

• Discovery. A marketplace brings buyers who were searching and had never heard of you. Replacing that with your own advertising has a cost, which belongs in line 5.
• Ownership of the relationship. A direct customer can be contacted again, within the rules and with their consent. On a marketplace the relationship largely belongs to the platform.
• Dependence. A seller with every order on one platform is exposed to fee changes and policy changes. A second channel is insurance.
• Cash timing. Marketplaces hold funds until the order completes. Direct payments arrive sooner, and the risk of non-payment is yours.
• Basket size. In chat you can suggest an addition or a bundle. Larger orders spread the fixed handling cost.

Lowering the costs on each side

On the marketplace:

• Review which programmes you joined and whether each pays back.
• Measure advertising by orders gained, and stop what does not earn.
• Raise the basket with bundles, since several costs are per order.
• Reduce returns with accurate descriptions and good packing.

On WhatsApp:

• Cut chat time. Saved replies for the common questions, a catalogue with prices, a clear order format. This attacks the largest hidden cost.
• Automate payment checking with a payment link or QR that confirms itself.
• Set a minimum order for free shipping.
• Take payment before sending. Unpaid orders disappear.
• Focus direct effort on repeat customers, where acquisition is nearly free.

A sensible division of labour

Many small sellers settle here:

• Marketplace for being found. New buyers, search traffic, trust for first purchases.
• Direct for keeping. Repeat orders, larger orders, pre-orders, customers who want advice.

Respect each platform's rules about contacting buyers and directing them off the platform. A card in the parcel with your brand's own contact details and a reason to get in touch, such as care instructions or a reorder reminder, is a common approach. Check the current rules of the platforms you use before doing it.

Run the numbers every quarter

Fees, programmes and your own costs move. A channel that was better in March may not be in September. Keep the worksheet and update it with a fresh month of data each quarter.

Recording orders, costs and payments by channel in one set of books is what makes this a ten-minute job. Polynusa's bookkeeping and sales inbox share one workspace, so chat orders and their payments are recorded where the margin can be worked out. See the pricing page.

Summary

Compare channels per order, not by impression. List seven cost lines for each, taking marketplace costs from real income reports and measuring the hidden direct costs, above all staff time. Expect direct sales to win with repeat customers and marketplaces to win at being found. Reduce chat time, payment checking and shipping subsidy on the direct side, review programmes and ads on the marketplace side, and repeat the calculation each quarter.

FAQ

Is selling through WhatsApp cheaper than a marketplace?

Not automatically. A marketplace charges visible fees. Selling direct has costs that do not appear on a statement: staff time per order, payment fees, shipping you subsidise, failed deliveries you absorb, and the cost of finding customers. Only a per-order calculation with your own numbers tells you which channel keeps more.

Where do I find my actual marketplace fees?

In the order or income report from the seller dashboard, which lists deductions per order: commission, service or programme fees, payment fees, shipping charges and voucher contributions. Use a month of real orders, not the published rate card, because the programmes you joined and the vouchers you funded change the total.

Should a seller leave marketplaces to sell direct?

Rarely all at once. Marketplaces bring new buyers who are searching, which is costly to replace. Direct channels suit repeat customers who already know you. Many sellers do best using the marketplace to be found and a direct channel to keep the customers they have earned, within each platform's rules.