The Future of B2B E-Commerce and How to Start Your First Move in Digital Market
Business-to-Business (B2B) is about connecting buyer and sellers internationally. Stats have shown that global B2B trading will substantially increase from $226 billion (2001) to $2.02 trillion (2006). The B2B E-Commerce digital revolution means more procurement opportunities for business, increased B2B exchanges, and a developed digital economy. B2B E-Business eliminates intermediaries, thereby reducing costs while offering responsiveness to industry changes. B2B selling includes vertical market portals and various types of auctions. A single Infomediary brings together multiple buyers and sellers within a specific industry and charges a commission for all transactions. Thousands of industry-specific trades are now taking place every day.
The traditional and emerging B2B E-Business brings together sellers and buyers from around the world using digital platforms (B2B E-Marketplace) to facilitate business transactions online. There are many different kinds of independent trade exchange e-marketplaces, which are formed for the exclusive use of suppliers, buyers, and wholesalers. Majority of the most popular B2B e-commerce marketplaces support nearly all major types of B2B digital transactions.
There are many reasons why B2B E-Business is so essential, and the process includes; contracts attained online, B2B auctions, wholesale and stock procurement, as well as international trading. When digital online trading first began, there was a dramatic boom of approximately 2,500 online B2B exchanges worldwide within the first year. B2B revolutionises the way businesses do trading and has fundamentally transformed the trading industry globally.
Why do Consumers Choose B2B E-Commerce
E-Commerce is the emerging B2B E-Marketplace for products and services through various online marketplaces, such as online stores, Amazon, Alibaba, and E-bay. With online consumerism growing dramatically every year, more business than ever is moving to the B2B E-Commerce for increased revenue in sales. When looking at consumer data, we see that 61% of people in the USA prefer to purchase products and services online, as opposed to in the store.
E-commerce Empowers Consumers:
Consumers need information; in today’s age, consumers have become critical to businesses, and therefore are more discerning than ever. When buying online consumers can retrieve the information they need, immediately to give them the satisfaction need to buy the product. Consumers can get information quickly about the product they may wish to purchase from the online catalog or description.
Why B2B E-Marketplace is Important
With every year, B2B models are moving to e-commerce as a primary business solution. Recent statistics have shown that 32% of retailers are choosing to move to e-business. More and more businesses are using e-marketplaces as an opportunity to find new buyers and suppliers in other areas that may be interested in what they have to offer. B2B E-Commerce allows for more rapid delivery, better product selection, and even more transparent pricing. B2b E-Marketplace enables an organisation to find trading partners easier and faster, to everyone’s advantage.
Why do Businesses Choose E-Commerce?
More businesses are choosing to purchase online every year. Ordering wholesale stock online allows for a significant reduction in financial overheads, such as delivery which can be time-consuming when done by purchasing directly from the store. Companies looking to buy online can build relationships with other online businesses, which can foster business growth.
There are many reasons why more businesses are choosing to sell their products through e-commerce every year. Some of the key ideas are the following:
- Product Data:
One of the most important parts of running a business in the lighting sector is having data which give you information about your customers. Having access to the right data for your online store is vital because it allows you to see which products are selling the best, fastest and which products aren’t selling at all. Although that information could easily be correlated in monthly financial statements, e-commerce takes that one step further. With the right software installed, it’s possible to track every detail of the customers buying process. Data such as how long they spent looking at a particular product, or at which point they left the website, will be available on a daily basis. Statistics and online surveys, offer invaluable insight into sales trends on a day to day basis as well as the level of engagement that businesses have when browsing through the products.
- Search Engine Visibility:
In the past, customer service and relationships driver the trading industry, but e-commerce are about being visible in the marketplace. Search engine visibility is important because it helps businesses engage in B2B selling better and faster, but what it also means is that traders can land on e-commerce websites that they’ve never heard of before. It means that companies selling through online marketplaces are accessing more buyers and suppliers and therefore making increased revenue sales.
- Online Shops
- Minimal Capital Investment
B2B E-Commerce has become one of the most innovative ways for businesses to expand their growth. At present, B2B sales are projected to reach $1.13 trillion by 2020, as more B2B sellers and buyers are starting to recognise the benefits of selling online. Merchants have a variety of ways in which to expand their e-businesses. By using B2B e-marketplace such as Amazon and Alibaba, connects businesses that are selling to companies that are buying. That enables B2B buyers to purchase different products from different sellers in one place. B2B marketplaces have many various features that will fulfill the business requirements of the buyers and sellers. Some of these features include bulk orders, discounts based on quantity, edit wholesale purchase orders, and various payment types which work internationally.
Advantages of B2B Business Marketplaces:
With B2B selling all suppliers and distributors have a more extensive outreach. Overall, there is a lower entry cost, so businesses sellers don’t have to spend time creating a boutique e-commerce platform. There is minimal investment required. Another advantage is that marketing costs are minimal. It indicates that it’s easier to connect with buyers, without paying hefty fees. Selling B2B also says that there are a lot of available online marketplaces. When trading in the digital marketplace, it is easier to find trading partners from across the world. Using online marketplaces to buy or sell wholesale products, is integral to the success of a business because it gives firms great access to much-needed data. Having access to data offers valuable insights.
- Specialisation and Segmentation:
For B2B digital trading, businesses looking for online marketplaces, have a selection of different marketplaces available such as Global source, Alibaba, and for the lighting industry, there is Lighting Arena's Marketplace. Therefore, companies can lessen the amount of time spent on administration and focus on driving and increasing revenue sales.
- Simple Pricing Tiers:
With many advancements in B2B marketplaces, businesses are presenting services in a modern and accessible way. That enables B2B traders to increase sales by using the many tools and features available in online marketplaces. Tiered pricing guidelines that are straightforward, marketplaces allows business owners to identify the best trading partners possible and enable them to close a deal faster than it would take via traditional trading.
Disadvantages of B2B Business Marketplaces
There can be various challenges that arise when selling B2B. Aspects such catalog management can be daunting for tech novices, as well as uploading images and information about products. One of the most significant challenges can be convincing long-term buyers that are used to buying stock via traditional methods to change to online wholesale purchase. It might be that the company has been doing things the same way for the past years and is not open to new ideas, or that they have concerns about the security. Other businesses have cited that they were unhappy with the marketplace and thus wanted to revert to older selling methods. However, some would consider this as an archaic and redundant approach to meeting inevitable technological advancements.
Sales Challenges & Comparison Features:
B2C marketplaces offer a straightforward sales cycle, and with many B2B companies plagued by long-period sales, means that there are many complex variables before closing a sale. While online digital selling might imply that B2C traders might close some impulsive purchases, which is rarely ever the case. Online B2B digital marketplaces need to provide comprehensive features to compare allow buyers to compare potential buyers and suppliers.
Every year more businesses are choosing to move to B2B E-Commerce. Although it may seem daunting, customers are becoming more prepared to pay shipping fees for heavier items if it means that they can obtain the thing they want. Online marketplaces give the immediate customer gratification, which when they see what they want, they can buy it immediately. Even though many stores have retail locations, many businesses are doubling their revenue by also selling their products online. It does not only mean a higher customer conversion rate, and it means international exposure. Technology has become so advanced that selling items in the marketplace has become substantially more affordable, due to having no shop overheads such as rent and staff. Which essentially means more profit for the business.