Business-to-Business

Retail is a tough place to be, whether it's on the Internet or not. Lots of customers with small orders who feel they should be treated as if they were spending millions. Customers who don't pay or whose credit cards don't work. Customers who break things because they don't know how to use them and then want their money back. Customers who complain about everything. Customers who insist they need the product immediately and then don't show up to pick it up. Retail is tough because your customers are individuals, not businesses.

Wouldn't you like to have only a few customers who place large orders? Customers who pay regularly? Customers with professional qualifications who only complain when something is wrong? Customers who know what they need and when they need it? Welcome to business-to-business commerce.

Business-to-business commerce is great if you're good. Businesses place large orders but they expect to be treated correspondingly well. They'll pay if they're satisfied. They won't complain very often - they'll get another supplier instead. They know when they need something and they expect to get it on time.

While retail e-commerce is growing rapidly because it's convenient, business-to-business e-commerce is growing because the cost of transactions is much lower. Instead of exchanging pricing and delivery, PO's, shipping papers, invoices and cheques, companies can complete a purchase in one on-line visit with tremendous savings. A buyer can visit a supplier's site, determine the price and quantity in stock, place his order, transfer the corresponding sum and have his shipping papers printed out in the time it would normally take to fax in a request for pricing. As a result, the growth and volume of business-to-business e-commerce is far outstripping business-to-individual e-commerce. Sounds like a good target for any small business.

For further discussion on business-to-business e-commerce, have a look at the OECD Workshop on the subject. Try "The US Experience" for some good graphs and "The Asian Experience" for a good world overview. You'll need the Adobe Acrobat Reader.

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