Understanding B2B Commerce: Types and Trends

B2B commerce isn’t just a buzzword; it’s the engine driving modern business forward. It’s transforming how companies connect, sell, and scale, offering a streamlined way to reach more customers and boost efficiency. If you’re not already in the game, you’re missing out on a massive opportunity to stay ahead of the competition.

In this post, we’ll break down the key types of B2B commerce, and explore the trends that are set to dominate 2024. 

Whether you’re a wholesaler, manufacturer, or distributor, getting a grip on these shifts isn’t optional—it’s essential if you want to thrive in the ever-changing landscape of digital commerce.

What is B2B commerce?

B2B commerce, or Business-to-Business commerce, refers to the transaction of goods, services, or information between two businesses rather than between a business and an individual consumer. 

In B2B commerce, businesses sell products or services to other companies, which may use them in their operations, resell them to consumers, or incorporate them into their own products. 

Key features of B2B Commerce:

• Larger Order Volumes: B2B transactions typically involve bulk purchases, leading to higher order values compared to B2C sales.
• Complex Decision-Making Process: Multiple stakeholders are often involved in B2B purchasing decisions, leading to longer sales cycles.
• Negotiation-Based Pricing: Prices in B2B commerce are often negotiated based on order size, contract terms, and long-term partnerships.
• Long-Term Relationships: B2B transactions often involve building and maintaining long-term relationships between businesses.
• Customized Products and Services: B2B transactions frequently involve products or services tailored to the specific needs of the purchasing business.
• Extended Payment Terms: B2B sales often include negotiated payment terms, such as net 30 or net 60 days, allowing businesses time to pay after receiving goods or services.

For example, in the automotive industry, parts manufacturers sell components like engines or seat belts to car manufacturers. With B2B commerce, this process is streamlined, reducing the need for in-person meetings and speeding up transactions.

In short, B2B commerce modernizes business transactions, making them quicker, more efficient, and customer-focused.

Types of B2B commerce

When diving into B2B commerce, you’ll typically find businesses operating in one or more of the following categories. Each type has its own set of advantages and challenges, and understanding them can help you choose the right path for your business.

1. B2B2C (Business-to-Business-to-Consumer)

B2B2C involves businesses selling directly to consumers, often bypassing traditional middlemen. Here’s how it works:

• Manufacturers or wholesalers produce goods.
• These goods are sold to B2B entities.
• The B2B entity then sells directly to consumers, often through a digital storefront.

Example: A company might sell a product online that consumers believe is directly from them, but it was produced by another manufacturer. This approach allows businesses to reach consumers directly while still benefiting from B2B relationships.

2. Wholesale

In the wholesale model, businesses purchase goods in bulk from manufacturers or distributors and then sell them at retail prices. Key aspects include:

• Bulk purchasing reduces costs.
• Buyer-oriented B2B marketplaces allow wholesalers to advertise products with minimal marketing effort.
• These marketplaces are often dominated by buyers who invite suppliers to present their products and accept bids.

Example: A wholesaler might buy clothing in bulk from a manufacturer and then sell it to retailers who sell directly to consumers.

3. Manufacturer

Manufacturers create goods in large quantities, which are then sold to other suppliers, wholesalers, or manufacturers. Important points to note:

• Manufacturers need to adapt to digital demand by offering online transactions and personalized features like custom pricing or production schedules.
• These goods might be further processed or assembled before reaching the consumer.

Example: A shoelace manufacturer sells its product to a luxury shoe company, which then assembles the final product and sells it to wholesalers.

4. Distributor

Distributors handle packaging, shipping, and marketing, helping manufacturers who prefer to focus solely on production. The benefits include:

• Streamlining supply chains by forming online partnerships with manufacturers.
• Outsourcing fulfillment to large ecommerce platforms like Amazon can be more cost-effective.

Example: Many businesses use Amazon’s fulfillment services to handle shipping and customer service, allowing them to focus on production and sales.

Also Read: B2B Ordering Platform For Distributors And Brand Owners

How does B2B Commerce Work?

B2B commerce operates as a transactional exchange where one business, often a vendor, sells products or services to another business. Unlike consumer transactions, B2B deals are usually more complex and involve multiple stakeholders within both the selling and buying organizations.

Here’s a breakdown of how B2B commerce typically works:

1. The Sales Process:
   • In B2B transactions, a dedicated sales team or department usually manages the process. This team is responsible for understanding the needs of the buyer, offering solutions, and negotiating terms.
   • Depending on the size and nature of the purchase, the transaction might involve a single buyer or an entire buying committee.
2. The Buying Committee:
   • For larger or more intricate purchases, a buying committee is often formed. This committee usually consists of:
     • Business decision-makers: Individuals responsible for budget approval.
     • Technical decision-makers: Experts who assess the product’s technical suitability.
     • Influencers: Users or employees who will directly interact with the product and provide input on its functionality and usability.
   • The collective input from this group ensures that the purchase aligns with the company’s strategic goals and operational needs.
3. The Role of RFPs (Request for Proposals):
   • For significant purchases, businesses might issue an RFP. This is an invitation for vendors to submit detailed proposals that outline their products, terms of service, and pricing.
   • The RFP process allows the buying company to compare offerings from multiple vendors, ensuring they choose the best fit for their needs.

In short, B2B commerce is not just about selling a product or service; it’s about building relationships and ensuring that the purchase decision supports the broader goals of the buying organization. 

This often involves multiple layers of evaluation, negotiation, and collaboration to meet the specific requirements of the business buyer.

Trends to Watch in B2B Commerce for 2024

As we move into 2024, B2B commerce is evolving rapidly, driven by shifting buyer expectations and technological advancements. Here are some key trends to watch:

1. Self-Service Buying

B2B buyers increasingly prefer self-service options, with self-directed interactions now outpacing human interactions by 15% versus 12%. This shift means sales reps need to adapt, focusing more on providing value-added services and leveraging omnichannel strategies to meet customer demands.

2. Generative AI (GenAI)

Generative AI is gaining traction in B2B commerce, though only 25% of businesses are expected to see a return on investment in 2024. When used effectively, GenAI can streamline processes, prioritize leads, and personalize customer interactions, leading to higher win rates and improved customer satisfaction.

Also Read: How AI in B2B Wholesale & Distribution Is a Revolution??

3. Payment Flexibility

B2B buyers are seeking more payment options that align with their financial preferences. In 2024, expect to see a rise in digital commerce solutions that offer flexible payment methods like invoicing, credit lines, and online payments, making transactions smoother and more efficient.

4. B2C Experiences for B2B Buyers

B2B buyers now expect B2C-like experiences in their purchasing journey. This includes clear pricing, real-time inventory updates, and tailored content. As 50% of Chief Sales Officers plan to focus on selling rather than managing sellers by 2025, businesses must invest in digital platforms that deliver seamless, customer-centric experiences.

5. A Mobile-First Approach

Image Souce: McKinsey & Company

With B2B buyers using about 10 channels during their purchasing journey, there’s a notable shift towards mobile-focused channels. Social media, mobile apps, and text messaging are becoming more prevalent, driving the need for a mobile-first strategy in B2B commerce.

6. Automation

Automation is essential for B2B businesses looking to do more with less. Automating tasks like inventory management, order processing, and customer service can reduce errors, free up resources, and enhance the overall customer experience.

7. Omnichannel Experiences

B2B buyers now expect a seamless omnichannel experience, with 35% rating eCommerce as the most effective sales channel. Investing in technology that integrates all digital touchpoints is crucial to meeting these expectations.

8. B2B Marketplaces

B2B marketplaces like Amazon Business and Alibaba.com are becoming top destinations for buyers, with nearly 50% of companies succeeding in B2B eCommerce thanks to these platforms. Marketplaces provide convenience, comparison tools, and a broader reach for sellers.

9. Recurring Orders

Recurring orders and subscriptions are becoming a significant revenue stream in B2B commerce. Improving repurchase rates can boost customer lifetime value and build loyalty, making this a trend to capitalize on in 2024.

10. Investing in Composable Commerce Technology

As B2B companies look to stay competitive, they’re investing in composable commerce systems that offer adaptability and scalability. These systems allow for quick adjustments to market changes, seamless integration with existing technologies, and a flexible approach to customer experience.

How does WizCommerce Empower B2B Wholesalers to Thrive in 2024?

As B2B commerce continues to evolve in 2024, staying ahead of the curve is essential for wholesalers, manufacturers, and distributors. 

WizCommerce is designed to help businesses like yours not only keep up with these trends but also thrive in this rapidly changing landscape. 

Here’s how WizCommerce aligns with the most relevant B2B commerce trends:

AI-Powered Recommendations

B2B buyers are increasingly looking for personalized and efficient shopping experiences. To meet this demand, WizCommerce leverages AI-powered recommendations that help you:

• Identify upsell and cross-sell opportunities similar to Amazon’s recommendation engine.
• Enhance customer experience by offering relevant product suggestions.
• Drive additional revenue by encouraging larger and more frequent purchases.

Omnichannel Experiences

B2B buyers now expect a seamless omnichannel experience across all touchpoints. WizCommerce delivers this by integrating both online and offline sales channels. Here’s how it works:

• Mobile apps for on-the-go selling: Empower your sales reps to sell effectively, whether they are in the field or at a trade show.
• Offline order capabilities: Ensure that your sales team can take orders even in areas with patchy network connectivity.
• Robust online storefront: Provide customers with a consistent and cohesive buying experience, no matter where they interact with your brand.

Payment Flexibility

Flexibility in payment options is crucial for 2024, as B2B buyers seek payment methods that align with their financial preferences. WizCommerce makes this easy by offering:

• Flexible checkout options: Customers can choose from various payment terms, such as click-to-pay, card-on-file, and custom payment terms.
• Reduced friction in the purchasing process: Simplified payment options make it easier for your customers to complete transactions, helping you close sales faster.

Stay ahead of the curve with WizCommerce. Whether it’s embracing AI, offering flexible payment options, or creating seamless omnichannel experiences, WizCommerce has the tools you need to succeed in 2024.

Book a Demo now and discover how WizCommerce can transform your B2B operations and keep your business on the growth path.

Conclusion

Adopting B2B e-commerce is no longer a luxury—it’s a necessity for businesses looking to stay competitive in 2024. As buyer expectations shift towards more personalized, efficient, and flexible experiences, embracing these changes is crucial. 

The future of B2B e-commerce will be heavily influenced by technological advancements like AI, automation, and omnichannel strategies. These innovations are not just trends; they are the building blocks of a successful and sustainable business model. 

By staying ahead of these developments, businesses can ensure they are well-positioned to thrive in the evolving digital landscape.

With WizCommerce, you can stay ahead of the curve by integrating cutting-edge technologies into your B2B operations. Book a demo now and explore how our solutions can drive your business growth in the ever-evolving digital landscape.