In our experience, b2b companies thinking about moving to eCommerce generally fall into two categories. The first group are probably in the process of scaling their business and recognise that manual sales order processes are holding them back. They know that customer self-service and automation will almost certainly reduce cost and create opportunities to increase margin. The second group are under pressure from their customers and competitors to modernise their sales approach. They know they have to move to eCommerce to retain business and maintain competitive advantage.
Both groups of companies anticipate that b2b eCommerce will improve performance, but before investing in new technology it’s important to look more closely at how introducing a digital sales channel might impact on the business. Here we examine some of the cost saving benefits and revenue earning opportunities that apply to both groups of businesses.
Cost reduction benefits
When the companies we work with implement an eCommerce solution, they tend to find that cost is reduced in a number of areas:
- The cost of designing, printing and distributing paper catalogues and order forms is usually completely eliminated, (or reduced to a tiny fraction of the original cost if a few of your customers still prefer to use a manual ordering process). Your eCommerce website is deigned to display large amounts of product information, imagery and supporting content in order to allow informed-decision making at the point of purchase.
- The cost of re-inputting order data into an accounting system, or transcribing orders placed by phone, email or face-to-face with a sales rep is removed. With a b2b eCommerce platform that’s integrated with an accounting system like Sage or Pegasus, orders can be placed online 24/7 using a variety of payment options, including account-specific pricing – and the order data is automatically shared across the system so avoid duplication of effort. Automating this process frees up staff time and allows them to focus on other more productive tasks.
- Costs related to order errors and returns are dramatically reduced or eliminated altogether. In manual ordering processes we often see a business cost averaging around £50 attributed to fixing each error, but these are much less likely to happen with an eCommerce system. Customers actively place and view items in their basket and receive an order confirmation immediately after the transaction has been completed – and there’s no manual inputting of order data required by staff because the entire process is automated.
- The cost of managing backorders is reduced or removed. If sales teams and customers do not have visibility of real-time stock levels, orders will inevitably be placed when products are unavailable. The cost of staff managing issues related to back orders can quickly grow and is unnecessary. With the right integrated b2b eCommerce solution, inventory displays in real-time online, so customers cannot order when products are out of stock.
- The cost of a legacy b2b eCommerce solution is removed. With a new state-of-the-art platform, technology maintenance and upgrade costs are eliminated. At the same time, improvements in the customer experience offered by a new system can help to retain customers and reduce the likelihood of losing business.
Revenue earning opportunities
The companies we work with are able to drive additional revenue from their b2b eCommerce systems in areas such as:
- Increasing the order-taking capacity of your business by replacing manual activities with automated ordering processes. With a b2b eCommerce platform you can keep up with order volumes at busy times and you’re not relying on the number of customer visits your reps make each day to generate business. You’re able to easily streamline previously slow processes and accelerate cash flow.
- Freeing up staff time to drive revenue in other areas of the business, such as new customer acquisition.
- Securing new business – perhaps from customers who have been inactive but have returned after they see you’re trading online, or maybe from customers in new locations who were difficult to service face-to-face before the switch to eCommerce.
- New marketing initiatives – a good b2b eCommerce platform enables you to personalise promotions for individual customers, set prices for specific accounts and offer special deals that encourage upsell and cross-sell activity. And with digital communication channels such as email and social media to hand, it’s easier to drive traffic to you eCommerce site too.
- Customer exposure to more product choices. With easy online access to your entire product catalogue, customers will be able to discover more products in your range. The self-service nature of b2b eCommerce allows customers to browse for the products they want (and perhaps didn’t realise your business sells), which can lead to more product trial, larger orders, and higher margins.