Last Updated on January 18, 2021 by Dan Christoffersen
Many people don’t fully understand the concept of B2B eCommerce. Not even those within the B2B and wholesale industry.
That is why we have written this blog post.
It serves as an introduction to all the concepts you need to know, to fully understand B2B eCommerce:
- 1: The basics of B2B eCommerce
- 2: The benefits of a B2B eCommerce platform
- 3: How to choose the right B2B eCommerce solution
- 4: The price of a B2B eCommerce platform
- 5: The sum-up
Because we cover all aspects of B2B eCommerce platforms, we call this blog post the definitive guide to B2B eCommerce platforms.
1: The basics of B2B eCommerce
In this first section, we focus on the basics you need to know, to truly understand B2B eCommerce. The section will cover the following:
- B2B and wholesale
- B2B eCommerce platforms
- B2B vs B2C eCommerce
If you feel that you already have a good understanding of the basics, you can skip this section and move directly to the section on the benefits of B2B eCommerce (platforms).
B2B and wholesale
B2B is an abbreviation of “Business-to-Business” and simply describes the act of selling and buying products and services between businesses. In comparison, B2C is the act of selling from businesses to consumers. Read everything you need to know about B2B here.
Wholesale is the business of selling large quantities of products – usually at lower prices per unit. Wholesale often occurs in the form of wholesalers selling their products to a range of retailers.
B2B and wholesale are by many considered to be somewhat the same. And while they are in some sense similar, they are not necessarily the same thing. We would argue that while wholesale is almost always B2B, B2B is often not wholesale. A simple “example” might help understand the difference:
It is seldom that consumers are buying very large quantities of a product. Why would a single consumer ever buy 100 lamps for instance? That is why wholesale is often taking place between businesses (B2B).
Ecommerce is an abbreviation of Electronic Commerce. So essentially it is the activity of selling and buying electronically. Although taking place in different variations earlier, eCommerce, as we know it today, was revolutionized by the introduction of the Internet in 1991.
The reach and importance of eCommerce has increased significantly since then, and is expected to increase further in the future.
This goes both for B2B eCommerce and B2C eCommerce. In 2015, 7.4% of worldwide retail sales came from eCommerce. In 2018 this figure had increased to 11.9%.
It is expected that the eCommerce share of global retails sales will increase to 22% in 2023.
B2B eCommerce platform
It should be quite obvious from the name, “B2B eCommerce platform”, that it is an essential part of B2B eCommerce.
So what is a B2B eCommerce platform?
To answer this question we will introduce the most essential part of a B2B Ecommerce platform; the B2B order portal (also sometimes referred to as a B2B webshop).
The B2B order portal is where your retailers order your products digitally.
After they log in, they can see the products, the prices, and general product information.
They then click on the product they wish to purchase, choose how many units they want, and finish the order. The entire purchasing process is quite similar to the one the retailers are used to as private consumers shopping online.
The wholesaler will receive the orders from the B2B order portal via their B2B eCommerce software instantly and can begin preparing the order. No manual or analog order handling is required.
Even though the B2B order portal is the most important part of a B2B eCommerce platform, there are also many other important features.
A B2B platform should include customer, product, and order management features.
It should include settings for tax, shipping, and general terms. Additionally, some B2B platforms offer dashboards with KPI’s and data visualizations.
Such dashboards can help the user gain insights into their business, customers, and sales.
B2B vs. B2C eCommerce
While eCommerce is widely implemented and appreciated in the B2C sector, the implementation of B2B eCommerce software has been much slower. As an example, only 40% of the Danish B2B companies had invested in B2B eCommerce in 2017. A figure that is actually quite high compared to many other countries.
The reason for this difference in implementation between B2C and B2B can be attributed to mainly one thing; Difference in the complexity of sales.
In most cases, selling B2B is much more complex than selling B2C. The reason is that B2B and wholesale make use of a myriad of price differentiation. This could be unique prices for certain retailers, different discount levels for different customer groups, required minimum order amount based on currency, differences in shipping prices, etc.
When companies instead sell B2C directly to consumers, they rarely make use of any sort of price differentiation. All the consumers are treated the same and are offered the same prices and terms. This, of course, means that implementing a B2C eCommerce platform is much easier than implementing a B2B eCommerce platform.
Due to this difference in complexity, prices of B2B eCommerce solutions have traditionally been much higher than that of B2C solutions.
This has naturally kept many small- and medium-sized B2B and wholesale companies from investing in a B2B eCommerce platform.
Luckily, the prices of B2B eCommerce platforms have decreased significantly in the last couple of years – something that we will get back to later in this post.
2: The Benefits of a B2B eCommerce platform
Having cleared the basics of B2B eCommerce and B2B eCommerce platforms, we turn to the benefits that they bring.
We are big advocates of B2B eCommerce software. We believe that companies of all sizes will benefit from investing in a B2B eCommerce platform.
There are lots of benefits by choosing a B2B eCommerce platform. And now we’ll cover what we believe are the 5 main benefits:
- Saving time and money
- Minimizing the risk of errors
- Happier retailers
- Better customer retention
- Increased order volume, size, and frequency
Saving time and money
If you own your own business (B2B, wholesale, or something else), you know that time is a valuable resource. It is however also a scarce resource. That is why you should try to save time where you can – and that’s why a B2B eCommerce platform is a great investment.
With a B2B platform, you will no longer have to answer (as many) questions from your retailers about prices and terms.
Instead, your customers have access to all the information they need via the order portal.
You will no longer need to spend hours manually inputting orders received on phone, email, and scanned order sheets. You will not need to spend time reviewing orders for mistakes – which is the topic of the next benefit.
Minimizing the risk of errors
A B2B eCommerce platform will greatly reduce the risk of order errors.
Your retailers are more likely to order the correct products when they can do it via your B2B order portal instead of on a phone or email. You and your colleagues are less likely to create order mistakes as a result of typos.
This will not only save you time but also decrease costs, resulting in faster delivery and happier customers.
If you want to stay in business, happy customers are of the essence. This also goes for companies that sell B2B and wholesale. And while you can make your customers – the retailers – happy in numerous ways, one of the easiest is investing in a B2B eCommerce platform.
Surveys show that 85% of B2B customers prefer the possibility to order online instead of speaking with a salesperson. Especially when they are purchasing from a regular supplier. Don’t worry, it is nothing personal. It is just more convenient for them in this way. If you think about it, wouldn’t you prefer the possibility to do your shopping online as well?
Better customer retention
A B2B e commerce platform is a great tool to improve customer retention. First and foremost, because your retailers prefer to order via a B2B order portal as described above.
Many retailers are actually willing to change a supplier based on whether they offer a digital order solution or not.
Another way that a B2B e-commerce platform improves customer retention, is by giving you a better overview of your retailers. We often hear from our customers that before they invested in our B2B eCommerce platform, they sometimes “forgot” smaller retailers. The reason for this simply was, that they had no tools to keep track of their customers. The smaller retailers that ordered less frequently were often not given the attention they deserved.
With a B2B eCommerce platform, you have a constantly updated overview of your retailers. You can see their order history, and how long it’s been since they last placed an order. That way you will know when it is time to reach out to them again.
Increased order volume, size, and frequency
Last but not least, a B2B eCommerce platform is very likely to increase your sales. There are several explanations for this effect. Happier customers and better customer retention as described before certainly plays a big part. Another reason is the visual appeal that the B2B order portal brings with it.
Compared to printed spreadsheets and emails, a B2B order portal really showcases your products in the best light.
Want your order volume and size to go “up”? Then a B2B eCommerce platform is a great way to start.
A B2B platform also greatly improves your possibility to leverage the strength of data. When your customers navigate and purchase via your B2B shop, they leave data for you to utilize.
This will help you gain customer insights and improve your offers to them in the future.
Want to learn more about the benefits of B2B eCommerce? Then feel free to book a 30 min online demo of our B2B eCommerce platform:
3: How to choose the right B2B eCommerce solution
Now that you’ve learned of all the benefits of a B2B eCommerce, hopefully, you will want to invest in a B2B eCommerce platform for your company.
In this section, we will cover 4 of the key characteristics to be aware of when choosing a B2B eCommerce platform. The 4 characteristics are:
- The set-up
- User experience
- The “looks”
If you are doing a B2B eCommerce platform comparison, these are the four main characteristics to look for.
(If you want to learn why we, in all modesty, believe that Turis is the best B2B eCommerce platform based on these 4 characteristics (and 2 other important characteristics), you can read our blog post here)
As mentioned earlier, time is a valuable resource. That is why the time you have to invest in setting up your B2B eCommerce platform is important.
When it comes to setting up a B2B platform, time is not only important, as it takes time away from other tasks. It is also important in the sense that you want to digitize your B2B and wholesale as soon as possible. You don’t want to be left behind and potentially lose your customers to the competitor. You know, the one who already invested in a B2B eCommerce platform.
This is also why we believe that you should not invest in a custom-built B2B eCommerce platform. (Unless you have very specialized needs or products). A custom-built B2B eCommerce solution built from scratch will take a long time to get done AND will cost a lot of money.
So the time it takes to set-up a B2B eCommerce platform is important. As such you should probably not choose a solution that takes months to get started with. Especially not when it can, in fact, be done in a matter of days.
A B2B eCommerce platform needs to be easy to use for both you and your customers. The user experience needs to be on point and user-friendly. If it isn’t, neither you nor your retailers will want to use it, and you might as well stick to manual order handling.
Navigating a B2B order portal should be intuitive for your retailers, and they should be able to place an order with just a few clicks. Only that way will both you and your retailers truly appreciate the new B2B platform – this means happier customers, increased sales and more time saved.
As mentioned earlier, one of the main benefits of a B2B platform is increased sales. One of the reasons for this is the visual appeal a B2B order portal provides. Compared with traditional B2B order channels such as spreadsheets, phone, and email, a B2B order portal showcases your product the way they deserve.
This also means that the “looks” of the B2B eCommerce solution you choose is rather important. After all, no matter how good-looking your products are, they can’t make up for an ugly B2B order portal.
Instead, make sure to choose an “aesthetic” B2B e commerce platform and B2B order portal. This will make your products be more appealing and allure your customers to purchase more.
Furthermore, it’s a good idea to choose a B2B eCommerce solution that allows you to customize the “looks” to match your brand and visual style.
The perhaps most important factor when deciding on what B2B eCommerce platform to invest in is the price.
B2B eCommerce platforms come in a wide range of prices, and there is no need to pay more than necessary. Also, if the B2B eCommerce solution is TOO expensive, it might simply not be profitable for your company to invest.
In the next section, we will focus on pricing. We will explain why B2B eCommerce solutions traditionally have been quite expensive, and why a B2B eCommerce platform today, does not have to cost your company a fortune.
4: Pricing of B2B platforms
Following from the last section, pricing is a very important factor when deciding whether to invest in a B2B eCommerce platform. Like many other decisions in a company, it basically boils down to a cost-benefit analysis. Are the benefits of B2B eCommerce smaller or greater than the price of the B2B eCommerce platform?
Since we have already listed some of the many benefits of B2B eCommerce platforms above, we will now turn to the costs – In this case, the price of a B2B eCommerce platform.
At the end of the section, we will give some case scenarios of the cost vs benefits of B2B eCommerce platforms, to really emphasize the point.
Development of price
Not long ago, having your own B2B eCommerce platform for your company was a costly affair.
The vendors of B2B eCommerce software solutions were very limited.
As a result, the few vendors that did exist were able to charge very high prices for their products.
Furthermore, the vendors would often bundle their B2B eCommerce platform and order portal with additional features to further bump up the price.
Many of these additional features were, however, unnecessary “filling” for a large fraction of the B2B and wholesale companies. It simply made the platforms more expensive without adding any value.
These high prices in the past, have unfortunately led to the misconception within the B2B and wholesale industry, that B2B eCommerce solutions are only affordable to enterprise-sized companies.
While this might have been true not so long ago, it certainly isn’t anymore.
This misconception is most likely one of the reasons for the slow digitization of B2B sales compared to B2C sales. But now, due in large parts to the rise of SaaS, the prices of B2B e-commerce platforms are taking a plunge.
Software as a service (SaaS) is a distribution model of software that has two main characteristics.
First, the supplier makes the software available to the user via the internet.
Second, the software is often sold as a license on a subscription basis either monthly or yearly.
The SaaS model has grown in popularity in the last couple of years and is used in various industries for a lot of different purposes. Some examples are accounting programs, ERP systems, communication software, and now B2B eCommerce.
The popularity of SaaS is attributable to the many benefits that it brings.
Compared to “traditional” software, software sold as SaaS means:
- Lower costs
- Quicker set-up
- Greater flexibility
- And better scalability.
While these are benefits most companies would appreciate, especially small- and medium-sized enterprises have gained from the rise of SaaS. The reason is that these companies now can afford software, programs, and services that simply weren’t affordable to them before.
And now, increased affordability is also making its way to the world of B2B eCommerce.
Today, a company can get its own B2B eCommerce platform for less than €100 a month. And these low-priced solutions still have enough functionality and flexibility for most companies.
Are you a new company that is just getting started? At Turis we offer a free version of our B2B eCommerce platform for companies that don’t have that many requirements.
At these prices, the benefits of a B2B eCommerce platform should surpass the costs in any cost-benefit analysis. Irrespective of the company size!
Having described the development of B2B eCommerce platform pricing, we move to the actual cost-benefit analysis of a B2B eCommerce platform.
Specifically, we will set up two scenarios to illustrate just how little benefit you need, for a B2B eCommerce platform to be a good investment. The scenarios are based on the pricing of our own B2B eCommerce solution, Turis, which is priced at €99 a month for the pro version. You can see all our versions, features, and prices here.
First scenario → Saving time
As described in the section on benefits, one of the main benefits of a B2B eCommerce platform is saving time. B2B eCommerce platforms save companies time due to multiple reasons. The main time-saver for most companies, however, is not having to use man-power to type in orders manually.
Let’s assume that someone in your company spends just 2 hours a week typing in B2B and wholesale orders.
Let’s further assume that this person is paid €20 an hour. Converting weekly hours to monthly and multiplying the wage, the manual order handling costs the company roughly €160 a month. This also means that the benefit of investing in a B2B e-commerce platform is €160 a month.
Costs of B2B eCommerce platform: €99 < benefit of saved time: €160
Compared to the monthly cost of a B2B eCommerce platform, this results in a net benefit of €61. And that is every month!
Second scenario → Increased sales
One of the other benefits of a B2B eCommerce platform is increased sales. The reason for this increase is happier customers, better customer retention, optimized user experience, and the possibility to utilize data for insights.
For the actual cost-benefit analysis lets assume that your B2B / wholesale company has a yearly revenue of €100,000. This means that for a B2B eCommerce platform to be a good investment, it only needs to lead to an 1.2% increase in sales. An increase above this and the B2B eCommerce platform is a good investment for your company. For the example below, we have assumed an increase in sales of 2%.
Costs of B2B eCommerce platform (1 year): €1188 < Increased sales (2%) €2000
Compared to the yearly cost of a B2B eCommerce platform, this results in a net benefit of €812 every year.
So is B2B eCommerce a good investment?
So what can we learn from the two, very simplified, scenarios above?
That it doesn’t require a lot of increased efficiency for a B2B e-commerce platform to be a good investment.
The two scenarios and the assumptions behind them are relatively conservative. Most of the companies we have worked with, experience saving a lot more than two hours of manual work. They also experience significant increases in sales – way above the actual cost of the eCommerce platform.
Adding to the likelihood of a positive cost-benefit analysis is the possibility of combining these benefits. It is rarely the case that a company investing in B2B eCommerce experiences only a single of the many benefits.
More likely, a company will experience BOTH saved time, increased sales, and many of the other benefits listed earlier. That is also why we believe that 99% of all companies that sell B2B or wholesale will find a B2B eCommerce solution a good investment.
5: The sum-up
There you have it. The definitive guide to B2B eCommerce. If you read it all the way through, we applaud you! It is a long text.
Think that your company is ready to enter the digital era and optimize its B2B and wholesale sales?
Then we would love to help you. You can get in touch with me at firstname.lastname@example.org.
You can also sign up for the completely free version of our B2B eCommerce platform right here:
Not completely convinced of the wonders of B2B eCommerce yet? Then you can read some of our many other blog posts here. Or maybe you’d rather have an online demo where we can show you how it works? You can book a 30 min demo right here: