I am a universal wishlist company which is adding new vendors to the site. Should I hire a company that provides this service or build my own system? What are the important factors I should keep in mind to offer the vendors?
I've been an affiliate, an affiliate manager (certified, won industry awards etc), and now run an agency that also does affiliate program management for companies (among other things).
There are many great options out there for companies just starting out in the affiliate space. I'd recommend starting with an affiliate network such as Commission Junction, ShareaSale, Impact Radius or Linkshare. Each network has its own strengths and weaknesses, but all of the major and trusted networks do a good job of vetting affiliates, allowing you to refresh creatives often, and track activities and performance without too many headaches.
After picking the network and having the program set up, you'll want to have a good and knowladgeable affiliate manager to handle the program, provide new ideas for creatives, keep track of stats, recruit potential affiliates, and monitor those in your program for fraud etc. It's a rather demanding job, so many companies contract out with agencies such as ours as "OPM's" or Outsourced Program Managers to take care of all the details and provide a steady stream of income.
Let me know if you need any further help, insight, or program management!
I would do a cost-benefit analysis to determine whether to build or buy. If affiliate marketing is part of your core competencies and you need specific customization, then it may be worth the cost to build. If not, there are great programs out there that will allow you to run your affiliate marketing programs.