While the concept of business-to-business (B2B) e-commerce is certainly not new, it might surprise you that one-quarter of the global manufacturing industry has adopted e-commerce as a way of doing business. In fact, many companies will only work with those manufacturers that are working with an e-commerce system. Additionally, millennials are either making or influencing purchasing decisions and they don’t engage salespeople until the middle of the purchasing system. Purchasing behaviors mimic business-to-consumer (B2C) buying behaviors in which brands must educate, build trust and community before a purchasing decision is made. B2B e-commerce supports these behaviors as well.
As a manufacturer, you can run your business far more effectively when you embrace new technologies. Utilizing an e-commerce supply chain can bring you closer to customers and provide insights to purchasing behavior.
Reliable, well-timed data is the important first step to succeeding in e-commerce. Your manufacturing business will be able to obtain data from across the supply chain, including:
- Your internal management system
- Your internal ERM system, which tracks inventory logistics
- Your CRM system that can be used to link purchasing behavior to business demographics
- Data from various vendors (e.g., utilities analysis; shipping and receiving analysis with your shipping carriers)
What do you do with all this data? First, you will need to convert that data into a standardized benchmark. Using this data, you will be able to create a solo, comprehensive, wall-to-wall view of the B2B transaction, and complete the analytics needed to make suggestions regarding potential supply chain options, such as distribution and fulfillment. Finally, you will have the ability to disclose the actual cost and actual delivery date to your customer before they even place an order.
If this all sounds good, there are many additional benefits. You will have the ability to take a step back and evaluate your supply chain logistics and ask questions such as:
- Are your current costs too high?
- What do your current costs include?
- Are you getting the best bang for your buck from your current shipping carrier?
- Are they getting shipments to customers when expected?
- What is the average amount of time from the moment an order is placed to the time the customer receives the order?
- Are your suppliers getting you the goods that were ordered when expected?
- Are you paying the right price for those goods?
B2B e-commerce enables you to target areas for substantial cost savings and discover where the best application of resources can improve quality of delivery and services. Your customers will appreciate the transparency of disclosing the actual cost and delivery date before they ever place an order. This allows the customer to analyze how much product they should purchase depending on the type of inventory system they are using and the current/future demand for the product. E-commerce addresses your customer’s need for fast and accurate response time.
When the proper systems are put in place and the data analytics are processed accurately, you will be able to achieve increased sales and decreased costs by identifying market opportunities, leveraging data for e-marketing, optimizing your operations, and helping your customer maximize value delivery to their customers. Further, the e-commerce capital investment can be offset with the depreciation expense deduction on your corporate tax return. These factors could potentially result in a healthy increase in after-tax cash flows in the long-term.
Need help building your digital roadmap? Call your MarksNelson Smart Technology professional at 816-743-7700 to discuss how our Digital Solutions Assessment will help you find the right tools to meet – and exceed – your goals.