The marketplace model has revolutionised global commerce, offering businesses a scalable and efficient way to connect suppliers with buyers. Companies adopting this type of digital model may think they have extracted themselves from the complexities of the supply chain and its coinciding risks– but this perception is misguided. While the marketplace structure may decentralise sourcing, it does not eliminate risk exposure —rather, it redistributes risk in new and often less visible ways.
As businesses embrace this model, ensuring robust due diligence remains critical and becomes increasingly complex. As transparency gaps widen and risk management becomes more challenging, companies must adopt fit-for-purpose solutions tailored to the unique challenges of marketplace approaches.
The challenge: reduced oversight in marketplace models
Unlike traditional supplier relationships, marketplaces decentralise sourcing, multiplying the number of players in your supply chain whilst reducing your leverage, making it even more difficult to maintain visibility and simultaneously further complicating risk management. While you may not be physically touching the product with the marketplace approach, you’re still deeply tied to its origin and outcomes – and responsible for their risks. Potential vulnerabilities to this structure include:
- Lack of direct oversight – Marketplace sellers often operate independently, making vetting and compliance more difficult.
- Human rights violations – Without strong due diligence, labour exploitation, forced labour and unsafe working conditions can go unnoticed.
- Data accuracy & transparency gaps – Marketplace models often struggle with fragmented data, making it hard to track compliance issues.
Getting it right: a feasible, fit-for-purpose approach
Combating the reduced oversight and potential transparency gaps from a marketplace model requires a proactive, targeted approach to risk management – understanding potential hotspots and emerging vulnerabilities before they become disruptive. Our recommendations for this approach include:
1. AI-powered media scanning for hidden risks
Supply chain risk is no longer confined to formal audits—news reports, social media discussions, and investigative journalism often reveal critical risks before they appear in compliance reports- which only provide a snapshot in time. Advanced media scanning technology enables businesses to:
- Detect early warnings of supplier misconduct through global news coverage and social media insights
- Identify red flags related to labour rights violations, environmental risks and regulatory infractions
- Continuously monitor risk trends across key sourcing regions
2. Embedding due diligence into marketplace onboarding
Businesses must integrate strong onboarding and monitoring protocols for marketplace sellers, ensuring ethical compliance from the start. Key strategies include:
- Pre-screening for high-risk suppliers – Vet marketplace vendors against human rights and sustainability criteria prior to onboarding through incident scans
- Adopting ongoing monitoring – Stay on top of risk trends, integrate supplier collaboration for data sharing and to build trust-based partnerships
3. Supplier education & support
Implementing digital training to align suppliers and partners on shared targets, ethical standards and policies allows a more flexible due diligence approach, reducing the rigidity of audit-centric risk management. With supplier training implemented digitally, businesses can proactively and more broadly promote site improvement and policy alignment while monitoring progress and increasing knowledge across various supply chain partners.
EiQ’s online learning management system contains a comprehensive course library designed specifically for supply chains on key sustainability topics. Our library includes hundreds of high-quality interactive video courses available in many languages. The solution’s management and reporting features enable you to monitor your training programme and disclose how you are educating your supply chain about critical sustainability topics.
As marketplace models continue to evolve and gain more traction, responsible sourcing must remain at the forefront to drive business transformation. Businesses that adopt a fit-for-purpose risk management approach—powered by data, predictive analytics and real-time media scanning— casting a wider net over vulnerabilities, whilst managing cost and resources.
By leveraging multi-functional tools like EiQ, organisations can maintain integrity, protect human rights and achieve total supply chain confidence.