Supplier onboarding is a crucial part of building a better marketplace. You can have the best platform, but without the right onboarding, you’ll suffer from lower retention and registrations.
 

Sellers want to begin their relationship with a marketplace smoothly, whether they be a homeowner renting their house out on Airbnb, a new driver on Uber or a brick-and-mortar business selling on eBay.

That's what onboarding offers: a smooth transition from sign-up to making a sale.

One survey found
   
of customers will switch platforms if onboarding is too complicated. Addressing the challenges of bringing suppliers to your marketplace requires you to understand the most common challenges they’ll face.
 

Challenges in Supplier Onboarding

Supplier challenges during the onboarding process vary from marketplace to marketplace. If you require specific documentation from vendors that is complicated to gather, it can create additional friction.

Validating suppliers can also help with user sign-up rates. If you have validation processes for listings, it can help build trust for the user and reduce the risk of fraud in the marketplace.

You'll want to put a system in place that:

We recommend following effective onboarding strategies that work for all marketplaces across any vertical.

Strategies for Effective Supplier Onboarding

The right strategies can help you overcome the challenges listed above and ensure that your onboarding is a success.

Focus on Technology

Invest in technology to improve and streamline your onboarding. Artificial intelligence (AI) and automation can:

Cloud-based solutions like
   
allow your onboarding process to be accessed anytime, anywhere and from any internet-connected device.
 

Clear Communication and Collaboration are Key

For onboarding to be a success, everyone needs to be on the same page. Clear and concise communication is key. Collaboration is equally important. 

Poor communication and lack of collaboration can damage supplier relationships and lead to lost opportunities.

Define Expectations and Requirements

Being clear and transparent about your requirements and expectations is crucial to the success of your onboarding process.

Suppliers want to know the rules and what’s expected of them. Otherwise, they won’t stick around for long. Make sure these policies are clearly outlined during onboarding.

One final note: make sure that the onboarding process is standardized yet flexible. Having a standard process will make it easier to measure your success and make changes as needed. 

Supplier Onboarding Success Stories

Vendor onboarding can mean the difference between success and failure. A prime example of this is Etsy.

The company increased active seller growth by
   
year-over-year in Q2 2022, and a large part of this is due to its onboarding process.
 

What makes the platform a success?

Etsy also knows that suppliers may be planning a future venture and may not complete onboarding. 

   So, what do they do?
 

They send an onboarding email to help you with adding a listing.

eBay became a household name when many other similar platforms failed in part due to their poor onboarding. You'll sign up using a standard form process, but there are also:

An entire team from eBay works on the onboarding process because they know that user experience and retention rely on the listing process.

Measuring Success in Supplier Onboarding

It’s not enough to create an onboarding process and hope for the best. To know if your process is truly working, you need to measure your success.

There are a few key metrics that can help you evaluate the effectiveness of your onboarding.

Adoption Rate

Adoption rate will be one of your most important metrics to focus on when measuring the success of your onboarding process. True adoption happens when the supplier has that “aha!” moment and finds value in your product. 

It's the moment they become active users. 

Measuring your adoption rate will give you a better idea of how many users:

How do you measure your product adoption rate?

If you find that your adoption rate is low, this may be a sign that your onboarding process needs some work. 

Onboarding Completion Rate

Another important metric to look at is your onboarding completion rate. How many new users are actually completing your onboarding process? 

Before you can start doing the math, you first need to define what “completion” means for your business. Depending on the complexity and nature of your platform, suppliers may not need to go through every single step of onboarding for it to be considered complete. 

If you find that your completion rate is low, this may indicate that your onboarding process is too complicated or takes too much time.

On the other hand, it’s important to remember that a 100% completion rate doesn't necessarily mean that your onboarding process is a success. Suppliers may be going through all of the steps, but your onboarding may not be thorough enough to keep them around.

That’s why it’s important to track your completion rate along with other metrics, like user retention.

User Retention

Ultimately, the goal of onboarding is to help users find the value in your product and become invested in it. User retention rate is a good indication of whether you’re reaching this goal with your onboarding process.

Here’s how to measure user retention:

If users are only sticking around for a month or never returning after signing up, then there may be issues with your onboarding.

It’s important to continually evaluate these metrics and make improvements to your onboarding as needed. 

Successful supplier onboarding should be reviewed often and become a major part of your operations. If you can find ways to eliminate friction during onboarding, it will help boost onboard completion rates and user retention.