First let’s define B2B. Business-to-business (or B2B) is a commercial transaction between one or more businesses. As a point of reference, B2C is a transaction between a business and an individual consumer. B2B selling cover a variety of scenarios such as wholesale, distribution relationships with large or chain retailers, selling to organizations (schools, businesses), Supplier selling to resellers.
B2B ecommerce is a growing segment. By the most recent reports, analysts have forecasted that global B2B ecommerce revenue will reach $6.7 trillion by the end of 2020. And yet, as of 2014, only 22% of B2B businesses in the US were selling online.
Businesses selling to businesses are moving into digital platforms to take advantage of the technologies now available for this type of transaction. B2B ecommerce platforms has brought efficiency and productivity for both sides: buyers and sellers. The old ways of placing orders over the phone or via fax and email are being replaced by robust digital platforms that cater for all needs of the B2B sector.
You may ask, but hasn’t ecommerce platforms being around for nearly a decade now? So what is the different between B2C and B2B platforms? Well, B2B platforms have all the features to support the B2C selling plus extra features required by B2B businesses. Let’s dig deeper into some of these B2B feature requirements:
1. Price Tiering
Price transparency and how the price is displayed online is a challenge for B2B selling. In the business world it is common for companies to negotiate prices for each of its clients. This may happen due to volume, terms and other arrangement made between the two parties. Price tiering allows business customers to see their own prices when they login to the ecommerce platform. Hence having one price for all is not really suitable as each customer may have a different price.
2. Payment Terms
Consumers pay for their purchase on the spot using credit card, Paypal and other merchant services. It has been like this in brick and mortar and it continued this way in online shopping. However, in B2B selling it is a practice for customers to pay later on terms such as 30 days. Business to business transactions are normally pre-qualified and vetted by a sales team, so the clients get an account where they can make all the purchases and pay the invoices later. The B2B ecommerce platform needs to allow for that, so that customers can place orders online without payment. Invoice and consolidated invoice capabilities can come very handy.
3. Efficiency Tools
Businesses strive to be efficient, specially in a competitive world. Tools to make the process more efficiency is a must when it comes to B2B transactions. Tools such as cloning of previous order, one page checkout, PDF importer for purchase orders are great advantages to both buyers and sellers.
4. B2B order workflow
B2B orders tend to be bigger orders. Therefore the orders may need to be checked and approved before there are ready for production and dispatch. Differently to B2C where the order is placed, paid and dispatch straight away with minimum checks, the B2B order requires the ecommerce platform to accommodate for order check and approval workflow.
5. Production Tools
B2B businesses are picking, packing and dispatching larger volume orders. Hence reports and tools to allow for better visibility of this data is a must for the warehouse team. Rather than picking, packing and dispatching order by order, B2B transactions are grouped together and prepared in bulk for efficiency purposes. The ecommerce platform should also allow for interaction between the commercial and the production team within an organisation to optimise the production process.
There are several more features that a B2B ecommerce platform should have. Think of how businesses interact and transpose that into a digital platform. This will provide the full picture of where B2B ecommerce is heading towards and the great advantages it will bring to the segment.