Selling Direct vs Online Marketplaces vs a Sourcing Partner
Selling direct gives you the customer relationship but takes the longest to build. Online manufacturing marketplaces can fill open capacity quickly on the platform's terms. A sourcing partner sits in between, bringing you matched jobs and handling paperwork in exchange for owning the buyer relationship. Most shops end up using more than one.
The short answer
No single channel is best. The right mix depends on how much sales time you have, how much control you want over price and customers, and whether the work involves controlled data.
A shop with a dedicated salesperson and a strong quality record will usually earn its best margins selling direct. A shop with idle spindles and no sales staff can fill gaps through a marketplace. A shop that wants aerospace work but not the burden of chasing buyers, decoding flow-downs or assembling cert packages alone may find a sourcing partner useful. Below is how each channel works, with the tradeoffs stated plainly, including the ones that apply to us.
Selling direct to primes and tier suppliers
Selling direct means you hold the purchase order, the relationship and the margin, and you also carry the full cost of winning and keeping the account.
The path runs through the buyer's supplier registration, a quality review, often a survey, and a first order watched closely. The approved supplier list guide covers that process in detail. Once approved, a good delivery and quality record can turn into steady repeat work with little sales effort per order.
Where it works well:
- You keep the full price, set your own terms and know exactly who the customer is.
- Long relationships give you early sight of upcoming programs and a say in manufacturability.
- Small business status can help, since large federal primes above the FAR threshold must set small business subcontracting goals. See small business subcontracting.
Where it is hard:
- Getting a buyer to start qualifying you can take many months of calls, visits and trade shows.
- Each buyer has its own portal, forms, quality clauses and audits, which multiplies paperwork.
- Payment terms are set by large companies and can be long.
- One or two big accounts can become most of your revenue, which is a risk if a program ends.
Online manufacturing marketplaces, in general
An online manufacturing marketplace takes orders from customers through its own website, often with instant pricing, and routes the work to a network of independent shops.
The platform owns the customer relationship. It usually sets or strongly influences the price, sets delivery expectations, manages customer communication and handles payment. Shops that join get access to demand they would not otherwise see, without having to market themselves. In exchange they work on the platform's terms and are scored on quality and on-time delivery.
Where marketplaces work well:
- Filling open machine time without a sales team.
- Prototype and short-run work in common materials and processes.
- Getting paid by one party under one set of terms.
Where they are harder:
- Pricing pressure, because you are often one of many shops that could take the job.
- Limited contact with the end customer, so it is harder to build a relationship that leads to repeat or higher-value work.
- Heavily specified aerospace and defense work, with controlled data and long flow-down lists, may not suit a high-volume, automated model. That varies by platform and by job, so ask.
Two marketplace examples, from their own sites
The specifics below come only from each company's own published pages, checked when this guide was written. Programs change, so confirm the current terms with the company before you join.
Xometry Partner Network
- Xometry says the Partner Network is free for partners to join and that there are no transaction or service fees, and no commitment to take any number of jobs per month.
- Jobs appear on a partner job board matched to the shop's capabilities. For Partner Network jobs, Xometry states there is no bidding and no time spent working on RFQs.
- Xometry also runs an RFQ Marketplace, where partners submit quotes, the customer sets a bidding period that Xometry says may range from 1 day to 2 weeks, and a 10% service fee is applied at customer checkout.
- Xometry says it does not require certifications to join, but that having them opens up more opportunities.
- Xometry states that it pays partners net 40, and that keeping quality and timeliness scores above 80 increases the number of RFQs a partner sees.
Protolabs Network (formerly Hubs)
- Protolabs Network describes an 8-step process for new suppliers that begins with Protolabs approaching suppliers it believes meet its standard, rather than an open signup.
- The steps it lists include a first evaluation, a factory audit covering quality management and environmental and social compliance, legal due diligence including background checks, technical training, and monitoring of the first 10 orders.
- It states that partners are audited every two years, with frequent spot checks at major sites, and lists certification to standards such as ISO 9001 and AS9100 where needed.
Working through a sourcing partner
A sourcing partner takes a buyer's request, finds qualified suppliers to do the work, manages the job and the paperwork, and delivers to the buyer. The supplier makes the part. The sourcing partner owns the buyer relationship and the coordination.
Aerospace Sourcing works this way. It is, for aerospace and defense buyers on Florida's Space Coast. Buyers send requests for custom parts, ground support equipment, obsolete parts, certified surplus material, test lab time and small-business subcontractors. We match each job to qualified suppliers, flow down the requirements, track the job, check the paperwork and deliver with a cert package. We do not run machines ourselves.
Where a sourcing partner can help a shop:
- Requirements arrive already sorted, so you know before quoting what the job really needs.
- Someone else checks the paperwork before it reaches the buyer, which catches mismatched certs early.
- Controlled data handling is defined up front. With us, every supplier signs a flow-down NDA before seeing customer data, and ITAR, EAR and CUI data moves only by secure transfer to US persons, never through the website.
- Requests can include work that rarely reaches a general marketplace, such as obsolete parts, ground support equipment, surplus material and test lab time.
The tradeoffs, stated plainly:
- You do not own the buyer relationship, and with us you do not learn the end customer unless that customer approves.
- A sourcing partner typically earns a share of the job value, as any intermediary does.
- Volume depends on the partner's buyers. Aerospace Sourcing is new, and we do not promise any volume of RFQs.
Side by side
This table compares the channels in general terms. Individual buyers, platforms and partners vary, so treat it as a starting point for your own questions.
| Question | Selling direct | Online marketplace | Sourcing partner |
|---|---|---|---|
| Who owns the customer? | You | The platform | The sourcing partner |
| Who sets the price? | You, through negotiation | Usually the platform, or a customer choosing among quotes | Negotiated between you and the partner |
| Sales effort for you | High | Low | Low to moderate |
| Time to first order | Often long | Can be short once accepted | Depends on matching work |
| Paperwork burden | All yours, buyer by buyer | Set by platform standards | Shared, with requirements flowed down and checked |
| Fit for controlled data | Yes, under your own controls | Varies by platform | Depends on the partner's controls |
Questions to ask before you join any channel
Whatever channel you consider, get clear answers to a few questions before you commit capacity.
- Who sets the price, and can I decline work without penalty?
- What are the payment terms, and who pays me?
- How is controlled technical data handled, and who can see it?
- What quality documents must ship with each order?
- How is my performance scored, and what happens if a score drops?
- Will I ever deal with the end customer directly?
Your answers to the supplier readiness checklist will also tell you which channels you can use today. The supplier guide covers the certifications and registrations each channel tends to expect.
Add a sourcing partner to your mix
You do not have to pick one channel. Many shops sell direct to a few key accounts and fill the gaps elsewhere. If you want another source of matched aerospace and defense requests, with requirements flowed down before you quote, sign up free at /suppliers/. You can also list certified surplus or spare test lab and cleanroom capacity, which rarely has an easy outlet through other channels. We review every signup and contact you when work fits.
Questions
Is it better to sell direct to primes or use a marketplace?
It depends on your sales capacity and goals. Selling direct usually brings better margins and lasting relationships, but it takes significant time to qualify and win accounts. Marketplaces can fill open capacity quickly with little sales effort, but the platform owns the customer and has strong influence over price. Many shops use direct sales for core accounts and other channels to fill gaps.
Do online marketplaces handle ITAR work?
Policies differ by platform and change over time, so check each platform's current terms and ask how ITAR technical data is stored, who can access it, and whether access is limited to US persons. For any controlled job, confirm the data handling before you accept, since your shop shares responsibility for how that data is protected.
How is a sourcing partner different from a broker?
The terms overlap. A sourcing partner in aerospace typically does more than pass along a quote. It flows down the buyer's requirements, tracks the job, checks certifications and inspection records, and delivers a complete cert package. Aerospace Sourcing works this way and does not run machines itself. Ask any intermediary exactly which of those steps it performs.
Will I know who the end customer is if I work with Aerospace Sourcing?
Not unless the customer approves. Every supplier signs a flow-down NDA before seeing customer data, and the end customer is shared only with that customer's approval. You will always receive the technical requirements needed to quote and build the job, and controlled data moves only by secure transfer to US persons.
Can I use a marketplace, a sourcing partner and direct sales at the same time?
Generally yes, as long as you respect each agreement. Read the terms for any exclusivity or non-circumvention clauses, especially about contacting end customers you met through an intermediary. Track your capacity carefully so a rush order from one channel does not cause a late delivery on another, since every channel scores on-time performance.
Related
Sources
Free to
join.
We contact you when work fits your shop.
Join the supplier network