What is a B2B Marketplace?
A B2B marketplace brings together many B2B buyers and sellers on one website so that they can perform transactions. B2B (business-to-business) denotes transactions between businesses, so the shopping experience of B2B marketplaces must meet the supply and purchasing needs of businesses.B2B marketplaces can be described in different ways. They are sometimes referred to as B2B procurement websites, sourcing portals, purchasing platforms, multi-vendor marketplaces, supplies catalogs, and more.
TYPES OF B2B E COMMERCE MARKETPLACE
B2B eCommerce marketplaces are varied and depend on quite a few factors like the structure of the buyers and sellers and other determining factors.
Horizontal vs Vertical marketplaces
Horizontal marketplaces sell a variety of goods and services across many different segments. In contrast, vertical marketplaces specialise in selling products and services in one particular market segment or sector.
One-to-many vs many-to-many marketplaces
The primary seller will sell or supply their products and services against agreed-upon pricing in a one-to-many marketplace. Whereas, in a more familiar many-to-many marketplace, an aggregator manages the marketplaces where buyers and suppliers of different sectors transact for products and services. Examples of a many-to-many B2B eCommerce marketplace are Amazon Business or Alibaba.com.
HOW WE WORK?
Before comprehending the business models, let’s get familiar with the key aspects that influence the business architecture and revenue generation for any B2B marketplace. These key entities contain seven major aspects:
Key partners
The ‘key partners’ are the major stakeholders on your marketplace platform. For a B2B marketplace, the key stakeholders are the businesses that place bulk orders for their supply chain replenishment, and the manufacturers and suppliers who accept and fulfill those orders.
Key resources
Resources define the key information that is supplied to the key partners for making choices and better decisions. The resources for a B2B marketplace could be the list of suppliers for the customers that help businesses to see the choices they have to place an order.
Options like access to supplier’s profiles, ratings, reviews, contact information, shipping options, etc. also come in the same class. The same also applies to suppliers who get access to set up their profiles and list their products.
Value proposition
As a value proposition or unique selling point, the B2B platform can guarantee as many connections, sellers, suppliers, and customers to each stakeholder. It aims at delivering the best to each side of the business.
Customer relationship
Customer relationship involves a healthy flow of information in a secure environment on the platform. The platform must ensure a safeguard to all the data concerned with the key stakeholders. This includes the privacy, safety, and security of user account data or payment information on both sides.
Customer segments
An algorithm is set to manage the segmentation and classification of all the customers in the marketplace. It must classify a customer on the grounds like order volume, the location of the shipment, type of products, etc.
For sellers, the platform must follow a similar approach where it should categorize the sellers based on products they offer, shipment reachability, reviews, and ratings, etc.
Cost structure
Cost structure manages the payment models and billing of the orders placed on the B2B marketplace. It must allow the flexibility to choose from different payment packages like a special discount on bulk orders, separate pricing for individual orders, custom discount management, etc.
Revenue streams
Revenue streams are responsible for the flow of money in and out of the platform. It actively involves the customers to admin payments and admin to seller payments. The flow can be different depending on the business model.
The payments for the orders will directly go to admin, and the admin will conduct regular payouts to the sellers after deducting the platform charges. There are many more options for this. We will discuss this in the subsequent sections of the article.