Importance of making B2B ecommerce a priority in manufacturing industry

Importance of making B2B ecommerce a priority in manufacturing industry

“Business to business also called B to B or B2B, is a form of transaction between businesses, such as one involving a manufacturer and wholesaler, or a wholesaler and a retailer. Business to business refers to business that is conducted between companies, rather than between a company and individual consumers.” Manufacturers are still struggling to change to B2B E-commerce because of their misconceptions which could be veering them off track and leading to missed opportunities of growth through E-commerce. Understandably selling technology based manufactured equipment online is different from selling consumer durables, or basic services but this cause needs to be championed for future growth and success in the manufacturing sector.

Manufacturers  know about special technological strategies to optimize aftermarket parts and services whether they are manufacturing tractors, air conditioners or industrial products but are handicapped by the kind of products they are dealing with considering their priority of need and requirement or size. Consider aircraft spare parts being sold online and an aircraft being grounded for days because of a delay in its delivery. Where does that leave the manufacturer and buyer? If this conflict can be suitably resolved amicably manufacturers are more than willing to give priority to B2B E-commerce.

Let us examine this issue further.

Manufacturers involved are clearly not yet aware of a few other things such as; the necessity to make B2B E-commerce a part of their business in order to not just be in competition but to survive. Today the world itself is powered by technology however as mentioned earlier despite realizing the necessity of implementing technology as a part of their strategy, they still are struggling to make it a reality.

According to surveys conducted the manufacturing businesses are lagging behind in implementation of B2B E-commerce because it is still not a priority to manufacturers. The world speaks; and the world is saying that there are huge gains in the E-commerce market. But, then why are manufacturers not yet implementing B2B E-commerce seriously and as a priority.

They realize the important challenges as improving customer services and experiences, growing sales and improving their IT related services but do not still prioritize B2B E-commerce. This is because of a failure to understand the positive impact of B2B E-commerce as a strategy despite knowing its implementation is essential to face aftermarket challenges.

Benefits of B2B Ecommerce for Manufacturers

To see it from the point of view of manufacturers:

  • Prioritizing B2B E-commerce entails upsetting existing dealers and customers who are used to a different strategy. What the manufacturer here fails to realize is that in this rapidly growing market, with B2B E-commerce they will be able to access and sell to a wider segment. This will boost revenue which is of prime importance to any business.
  • Manufacturers feel that there are huge challenges for the manufacturing sector in online E-commerce sales which I am sure will be overcome with time and growing technologies. They feel that when the sale of manufactured goods is direct it is straight forward but when it comes to aftermarket sales the main challenge would come for example in selling spare parts of machinery. In E-commerce or online sales delivery takes time and sometimes machines need immediate attention. No one can wait for lack of spare parts or assembled parts for his machine, and for them buying it immediately from the manufacturer is a priority and a necessity because time is money. They feel that data science technology is useful and compelling, but still not geared enough to process and analyze manufacturing data to create unique user experiences. However if we go through market research reports we will realize the importance of convincing manufacturers to adopt E-commerce strategies at the earliest; perhaps in phases.
  • Forrester Research says, “….B2B E-commerce transactions will reach $1.2 trillion by 2021.   This will make up more than 13% of all B2B sales in the US.” While Frost and Sullivan records the global E-commerce sales to cross $6.6 trillion by 2020 and exceed B2C sales. This should convince manufacturers to make B2B E-commerce a priority by overcoming the hurdles they feel they will face  because the worldwide E-commerce business is growing by leaps and bounds.
  • An important issue is that the needs of a manufacturing industry are different. In order to prioritize B2B E-commerce the whole gamut of manufacturing must be taken into consideration. Mentioned above are the challenges faced by the sector from which we can assume that besides the sale of the manufactured goods; availability of aftermarket parts and services, configured assemblies, must all be enfolded in the plan to implement B2B E-commerce in the manufacturing sector. The message to the manufacturer here is that one can never wait for eternity to take important decisions and the faster the plans to go the B2B E-commerce way is implemented the better it is for the business. The innumerable positive sides to B2B E-commerce is reason enough to make it a priority even though in a phased manner.
  • A suggestion here would be to appoint a change maker amongst the executives who remains undaunted by the challenges and thinks out of the box so that the transition to B2B E-commerce is smooth.
  • It is advisable to also take the help of a Solution provider who understands the needs of a manufacturing industry, and engineering data in order to work hand in hand with the executive handling the transition to B2B E-commerce. What would be integral to this transition is a clear understanding of things like configuration design, part price optimizing,  ERP integration amongst other things.  

So it’s time to stop resisting change. The online channels are waiting for your entry. To strike a balance, direct sales need not be affected by online sales. For example, a truck driver might still come to buy at dealer’s outlet as they may not be equipped to handle the internet. Where the aftermarket part is a priority it should still be available off the shelf and across the counter besides being available on online channels. The smart buyers are still waiting online, for manufacturers to sell there so that they can purchase from the comfort of their office and enjoy the privilege of having it delivered. Consider also your dealer network going online to order with you and your trucks delivering them in bulk. The storage facility is the dealer’s so that also helps. Incidentally this could be a practice already existing among manufacturers. The slight change will come in cataloguing and showing the same online in order to do away with unnecessary phone calls and emails. The payment too would be through a Gateway making things more lucid for you. With the use of Artificial Intelligence and Machine Learning dealers can also go easy on their inventory procedure and get automatic updates about dwindling stocks and the need to place orders. Thus the entire system is streamlined and smooth.

To stay competitive in a changing market the manufacturing industry needs to adopt B2B E-commerce and make it a priority. Expectations have changed and it is time to meet that and evolve.

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