Time and time again, businesses and enterprises will find that business is as much about communicating and building relationships with clients and potential leads, as it is about building trustworthy and profitable business-to-business channels in order to efficiently source every product and service you need to keep your operation running smoothly. In other words, communication is important on both B2B and B2C fronts for any and all business endeavors.
This is true more so than ever before, as the 21st century has paved the way for a globalized business landscape where levels of communication and commerce never before imagined have become the norm. In the UK alone, B2B ecommerce has grown to nearly £90 billion in 2014, catching up to comparable levels of local B2C as per Statista. There are countless options for B2B transactions today, and that’s both a great thing and an obstacle.
How the Internet Broadly Affects Business Relationships
On one hand, it offers a greater degree of flexibility as you get to choose from a wider pool of partners. On the other hand, it becomes harder to identify key players and find the best partners – and thus, you run the risk of missing out on a partnership that your competitor locally or from across the world might nab first.
However, not all of these challenges are as much of a hindrance as many companies first expect them to be. There’s much to be gained from modernizing your B2B options, such as simplifying large transactions, cutting costs, automating inventory and more as per Chron, and the downsides are near non-existent – so long as you know how to go about it all. If you’re a company that deals exclusively with B2B, then it’s absolutely vital that you make the most of what today’s online ecommerce options have to offer.
Here are a few comprehensive tips that will not only help you seamlessly implement the benefits of online B2B – it’ll show you how you can continue to keep transaction costs down and further improve your own ecommerce services and make it easier and more profitable for companies to choose you over your competitors.
Simplify Your Platform
A simple look at usage statistics through data aggregators Built With will reveal to you that the majority of the world’s ecommerce portals rely on one of a few simple and dominant platforms. These include giants such as Shopify, Magento, and WooCommerce. From there, it’s an eclectic mix of services competing with each other for insignificant market space, including names like Yahoo Store, Oracle Commerce and Volusion.
There’s a reason the top three are most common, however, with Magento taking the cake through its community version and extended Magento Enterprise platform: it’s complex, and markets itself as the workhorse of the ecommerce world, capable of taking on any number of tasks and integrated services.
WooCommerce comes second place for versatility, although it doesn’t share as much power as Magento and neither is it as simple or complete out-of-the-box as Shopify. That being said, what matters most for a great transition into ecommerce is matching your needs with the right service.
For smaller B2B transactions, you don’t even need to set up your own store as per a piece on USA Today’s AZ Central. For wholesale purposes, Shopify makes for a great out-of-the-box solution. As per Shopify itself, companies like Tesla and Herschel use Shopify to manage their online transactions, but as an automobile business, a minority of Tesla’s business is conducted online. Theoretically, it cares more about providing the proper marketing and information to potential customers, so these can inform themselves before making the purchase personally.
Herschel may be another matter, as clothing stores often sell online – yet they’re also in competition with online retailers that work directly with brands to offer a larger catalogue of various brands rather than stocking up on a single name.
You can also integrate the shopping cart and payment processing on your own website. Vertical integration is a great way to reduce costs and cut liability as per Investopedia, and if you want to enjoy the flexibility of hosting your own ecommerce process, there are several options.
With the popular choices in WooCommerce and Magento, functionality goes beyond what you get out-of-the-box. Shopify isn’t particularly customizable, and shops run on Shopify’s servers rather than your own, which isn’t ideal for commerce-oriented companies that want to make a leap into intensive ecommerce.
For them, Magento becomes the top platform choice due to being both a CMS and ecommerce solution, with initial features including benefits like seasonal and promotional price changes, upselling and cross-selling, advanced product filtering and searching, and a few other gems. As per CommonPlaces, it’s often compared with Drupal due to both being more than just an ecommerce solution, and their perceived complexity, although Drupal is used less often.
WooCommerce, on the other hand, is simpler. But as per WPZoom, it relies on WordPress and third-party plugins to truly gain mileage. Magento also has access to such extensions, but requires more expertise to install and tinker with.
Expanded Payment Options
Once you have the ideal platform to handle your budget and size, you’ll ideally have access to a customizable and largely pre-built shopping cart with wholesale functionality and features that pertain to your industry needs and company size. Great! Now you need a way for people to pay for all of that.
It’s true that offering expanded and alternative payment solutions is a great thing for your business, as it has been for over a decade as per Entrepreneur. It allows you to do business with companies and vendors not only through credit cards, but alternative payment methods such as PayPal, Skrill, etc. – but more importantly, you have to prioritize managing as many payment functions as you need within the services of a single vendor.
Ride the EDI Train
As per TechTarget, EDI stands for the electronic data interchange, and it’s the process all transaction data goes through over the course of a transaction. More broadly, it’s the exchange of electronic documents when doing business between businesses. Think purchase orders, invoicing, and receipts. Not too long ago, mailing and faxing was at the heart of this system – today, it’s automated through servers.
This is important because if you’re not already utilizing EDI for everything outside of your ecommerce transactions, you should be.
Buying things today isn’t as easy as exchanging cash for product hand-in-hand – if you’re ordering entire shipments of wholesale products overseas, then there are a myriad of separate costs to consider, and if several banks, payment processors and countries are involved, then the typical paper trail will only create complications and offer more opportunities for errors.
Optimize Your Payment Process
As per Ecommerce and B2B, the most dramatic impact that a shift towards ecommerce has for B2B businesses is lower cost and complexity in transactions. And transaction costs are a very, very big deal in the B2B market – StratoServe notes that they’re one of the chief challenges in B2B marketing.
When a customer buys a product from a business, typically the transaction costs for that purchase are fairly low when compared to the costs associated with B2B transactions. The reason behind this is that transaction costs are calculated primarily on the amount of data transferred and processed by payment processors during a transaction.
For customers buying a mug online, data that may be processed includes credit or debit card information, postal information, and purchase data. For larger business transactions, more data is exchanged at once in order to simplify the interchange process (that is, the exchange of order, invoicing, receipt and other record-keeping information between companies and their payment processors).
This data is called Level II and Level III data, and depending on what level you’re working with, the end result can be lower or higher transaction rates – even with the existing payment efficiencies that the Internet and ecommerce provides you with.
This relates to both regular and ecommerce in the way that efficient credit card processing can spell a difference of several hundred dollars in a larger, international shipment – a difference of 1 percent is possible and, over the course of many transactions, a true scalable benefit.
Recognize and Eliminate Fraud
Since ecommerce does not entail the physical exchange of money and goods in the same area, and doesn’t have the luxury of human supervision, the great benefits of electronic automation come at the expense that you also have to consider a greater risk of fraud. Information Age lists seven separate examples of this sort of fraud in ecommerce, including the more common real-world example of identity theft, and chargeback or “friendly” fraud.
A Nilson Report goes further into depth on the numbers, stating that for every $100 gained, fraud steals $0.057.
The typical formula here is to have an automated script that gathers data elements from previous and ongoing transactions to create a pattern by which to score certain transactions for possible fraud and false positive risks. That way, with a little time, every new transaction comes with a score card that allows you to weigh the risks versus rewards of a transaction more accurately.
There are a few other tips you can use to make the most of integrating your B2B services online, and making your own transactions simpler – such as utilizing the many B2C features that platforms provide to increase sales on the B2B front – but in general, if you’re looking for ways to leverage today’s financial technology developments, and look into its bright and growing future as per Inc, these are some great tips to start with.
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