eCommerce activities in B2C are very easy to identify and define: a store offers a product, the customer buys it. We can also speak of marketing, offer comparison, customer service and, eventually, the transaction. When we ask about eCommerce in B2B, the most frequent answer is the sales of the same products but in wholesale amounts and preferably on pallets. eCommerce area in B2B looks, however, different. What is more: it can change entirely the company strategy and its efficiency.
eCommerce in B2B is the abundance of opportunities
There is a multitude of studies, analyses and reports describing the sales potential of the Internet B2B channel. According to the most cautious estimates, the level of 150 billion PLN is within easy reach (unless it has already been exceeded). This is close to six times more than B2C market, but only about 5% of all B2B transactions. Observing the development of the Polish eCommerce sector, we frequently look at the U.S. The said share in that country reaches 30%. The potential is, thus, present but where is it exactly? The products most frequently bought in the Internet business to business sales include: office products, raw materials, manufacturing materials and products related to using the company assets. Also Higma Service sells such products. The case of competitive advantage building by this company through technology will be described below.
Optimising the costs of acquiring and retaining the customer
Strong competition between distributors makes it difficult to compete by means of the price, which is more and more similar for all distributors. If it is more difficult to compete by means of the price, you can offer more to the Customer for the same price. What can this added value be in B2B eCommerce transactions? It can be comprehensive control of the expenses, minimizing the likelihood of mistaken order performance and consequent reduction of error handling costs, complete automation of document flow, improved efficiency of employees’ work or the ability to report and verify sales plans in real time. If we are able to provide such a benefits’ package to the business customer, they loyalty will grow. What is more, the exit barrier will be much higher and we will reduce customer rotation, still offering the same product for the same price.
Business analysis a key to success in B2B eCommerce
All large B2B and IT projects should be started from a cross-sectional analysis. Implementing the project for Higma Service, key eCommerce challenges were identified, that is: more efficient service of customers in the entire territory of Poland, creation of a settlement mechanism for contract customers having many outlets, higher automation of the sales process, elimination of errors caused by a growing base of compatible products, improved efficiency of meeting scheduling or improved warehouse management. Each of those aspects contributes to significant improvement of the financial efficiency of the company.
Abraham Lincoln used to say that every work can be done if it is divided into small tasks. The same is true for IT solutions. In the said case, all works were divided into three major stages. The first consisted in creating new infrastructure and taking the load off the resources possessed by simplifying and automating repeatable processes; the second one was devoted to improving the entire sales process and creating new tools increasing the operating capacities of the sales department employees; the third one assumed that all the regular customers will be covered by the panel facilitating the process of sales, service and debt recovery.
Big data – collection and effective use of business data
Public institutions, mechanical and food industry, medical sector, education, administration, catering and hotel sector (HoReCa) as well as private companies have different needs and expectations. The collection and analysis of data have become an important aspect of business. According to the studies by InsightExpress, 80% of Polish IT managers believe that big data will be the grounds of their corporate strategies in the five years to come. The demand for such specialists grows by about 30% a year. Another basis for operation in eCommerce is data analysis. For such operations, a unique tool enabling to optimize business processes between the company and its vendors in everyday work.
Business results obtained
The introduction of innovative solutions changes the nature of work performed. After the said system was implemented, the time and labour intensity required for the handling and performance of orders were reduced by 50%. Human and equipment resources were liberated and they can be shifted to perform other tasks. In Harvard Business Review Poland published in January, in the article devoted to the Internet of things we could read the statement by Jeff Immelt who claims that each industrial company will be the software producer. This vision can be expanded also to services and it can be added that each company will have to invest in cost optimizing software in the years to come. The said software will open up new opportunities for optimization and the B2B eCommerce case described is a perfect example of that.