B2B E-Commerce: Overcoming The Challenges To Reap The Rewards

Unilog president Suchit Bachalli explores the challenges that wholesale distributors commonly face when implementing an e-commerce capability, and how to overcome them.

Id 8896 Ecommerce

Remember the Yellow Book? When it was thick enough to double as a booster seat? Now it’s almost slim enough to stabilize a wobbly table—if it doesn’t wind up in the  recycling bin. A few businesses still pay to advertise in the shell of what used to be the go-to for products and services, even though most consumers look for pizza, the plumber and the piano tuner online.  

A more dramatic shift is taking place in the way B2B businesses are selling their products: through e-commerce platforms. Forrester estimates B2B e-commerce sales in the U.S. will top $1 trillion by 2020, in comparison to the $304.9 billion B2C e-commerce market, according to the U.S. Department of Commerce.

Free Whitepaper: The State of B2B E-Commerce

What’s driving this growth? The shift in B2B buyers’ behaviors and the market’s response to them. Forrester estimates that 74 percent of today’s B2B buyers are researching at least half of their work purchases online, and 30 percent of them complete at least half of their work purchases online. Combined with the cost savings and convenience of e-commerce, more businesses are expected to move online in the next few years.

But despite this rapid growth, many wholesalers are still playing catch up with e-commerce. Are you one of them? Here are the biggest reasons why and how to overcome the common setbacks associated with B2B e-commerce adoption.

See the numbers behind industrial distribution e-commerce in ID's 2015 Survey of Operations

Challenge 1: Complex integration requirements

Unlike B2C e-commerce, which is a fairly straight-forward process—consumers go online to search for products and compare prices, enter their credit card and the product gets shipped—in the world of B2B e-commerce, the requirements are far more complex and involved.

For instance, wholesale distributors offer different prices on the same products to multiple customers, depending on the customer’s history, order quantity and purchase commitments. Therefore, the wholesaler’s e-commerce site must show the right prices to the right customer. Also, because B2B customers, such as procurement officers, often make purchases in larger quantities, the site needs to provide real-time access to product inventory, shipping information, as well as instant credit approvals and invoicing capabilities.

The Solution: Make sure your e-commerce platform seamlessly integrates with your ERP system.

ERP integration is extremely important when it comes to B2B e-commerce. Be wary of e-commerce platforms out there that are really designed for B2C environments. They likely won’t provide the integration you need. You’ll want to find an e-commerce solution designed for B2B environments that can offer multiple levels of integration with your ERP system and other back-end repositories.

An integrated system will help to speed up the processing time for orders, minimize data entry errors, collect payments on the spot, and track inventory in real-time so you can stay appropriately stocked and keep your catalogs up to date. In the process you’ll provide an enhanced customer experience and free up staff’s time spent on slogging through problems.

Challenge 2: Cost

B2B e-commerce implementations can get expensive, particularly if you’ve underestimated what it takes to adopt an e-commerce presence or don’t have the right platform to support your business. Because so many e-commerce platforms out there are designed for B2C environments, distributors find themselves having to piece together multiple, disparate pieces of software in order to create a complete and cohesive solution, or build their own e-commerce platforms from the ground-up. But, let’s face it, a wholesaler’s core business isn’t building e-commerce platforms, and many soon come to realize that they don’t have the capital, time or expertise to see the project through properly.

The Solution: Take your time to choose the right platform from the start.

The choice you make in your e-commerce platform is critical. If you don’t choose wisely, you’ll find yourself back at the drawing board, having to invest in multiple platforms before you find one that will do the trick. While investing in any e-commerce platform is significant, if you’ve built the right online presence, your investment will yield returns far sooner than you might think.

Challenge 3: Short on resources or expertise

Building a homegrown e-commerce system can be complicated and expensive. Unless you’re staffed up with a full team of developers, programmers and web designers to do the job correctly, it would be a wise choice to outsource.

The Solution: Outsource it.

Why take on that burden? With the right partner and the right technology, you’ll give your customers a new way to buy your products while easing many of your current business practices. Your e-commerce partner can serve as an extension of your company and alleviate the burden of having to tackle this huge undertaking on your own, allowing you to stay focused on your core business.

Challenge 4: Can’t find the right e-commerce platform or provider

Finding the right e-commerce platform to support your business can be tough because there are few products out there designed for the B2B sales environment. But they do exist.

The Solution: Do your research and turn to peers for recommendations.

Ask other distributors that have opened an online store what e-commerce platform they use. Go to industry meetings or trade shows. Look for reviews online. Trust your intuition and schedule meetings. You’ll get a terrific, free education in the process. Make sure you find someone who understands your specific needs and has experience with your industry and/or size company.  

Challenge 5: Keeping your brand identity intact when designing your e-commerce site

The Solution: Choose an e-commerce partner that understands your branding and design goals and can execute the site design to reflect your unique brand.

Unveiling an online store is the perfect opportunity to reinforce a strong brand or develop a new one. If strategic marketing is already a priority for your company, you will be well equipped to give your e-commerce launch the special attention it deserves. An integrated, carefully planned marketing strategy will yield the best results—specifically, getting customers to place orders online, report a positive experience, and become loyal, repeat purchasers.

You’ll want clear, consistent messaging and a visible brand, or personality, in every marketing component. Before you compete for customers on your site, you are competing for their attention in today’s crowded communication space. Look for an e-commerce partner that understands the marketing nuances too.

The challenges of establishing a B2B e-commerce platform are far more complex than a move from the yellow pages to the Internet, but the skinny Yellow Book is a stark symbol of a complete transformation in the way people research products and services. The stakes are a lot higher with an e-commerce platform. If Forrester’s estimates are on target, as current trends would indicate, wholesalers that continue to rely solely on traditional sales and marketing avenues will have an increasingly difficult time sustaining and increasing revenues. Businesses that have resisted jumping in will need to move past the integration challenges, time and resources, cost, finding the right partner, and sustaining brand identity.   

Suchit BachalliEven if you don’t feel ready to adopt an e-commerce platform, start the conversation about it­—with companies that already have a platform, as well as possible partners or providers. Being educated is the best first step in making B2B e-commerce a reality for your business. You may find you are more ready than you think, especially if it means being part of $1 trillion in sales.

 

Suchit Bachalli is president of Unilog, a global technology company which specializes in e-commerce and enriched product catalogs for the B2B marketplace. He brings 15 years of technology sales and management experience with a particular focus on wholesale distribution, retail and online commerce. Unilog’s flagship product, CIMM2, is a fully integrated e-commerce platform designed to fit the unique requirements of the wholesale distribution industry.

More in Operations