Admin - 06/29/2022

Industrial B2B MarketPlaces are on a highly rise.

Online shopping has revolutionized retail in the past decades. But the digital sales wave is also taking over the business-to-business (B2B) segment. Manufacturers are increasingly adopting online platforms to supply other manufacturing firms with raw materials, production supplies, finished products, and services. Due to the large variety of traded goods, this sub-branch of B2B e-commerce encompasses both generalist marketplaces, such as Alibaba or Amazon, and vendors specialized in a specific product sector or vertical.

Manufacturing e-commerce is a market on the rise. In China, the biggest manufacturing country worldwide, the B2B e-commerce market of industrial goods is set to double by 2025. Data on Europe and the United States suggests a milder growth and a significant difference in online procurement channels across world regions.

While a very limited share of European manufacturers generated sales from electronic data interchange (EDI), this type of procurement between manufacturers and buyers is more widespread in the United States. B2B companies’ commitment to innovation and e-commerce adoption also varies among countries. Compared to China or Japan, a higher percentage of U.S. B2B professionals reported their firms would prioritize digital manufacturing platforms over the next years.

A NEW TREND IS COMING

Manufacturers Go online (Suppliers)

Incentivized by increasing online demand, many manufacturing companies have launched their own e-commerce platforms. The U.S. industrial distributor Fastenal combined e-commerce and EDI channels, both accounting for over 16 percent of its net sales, an increasing figure since early 2021. Likewise, the UK-based industrial appliances provider Ferguson has seen online sales exceed 20 percent of its total revenue

CHANGING THE WAY OF PROCUREMENT

MarketPlaces - A solution you cannot Ignore

Online marketplaces offer manufacturers undeniable advantages: efficient customer service, user-friendly online and mobile interface, more reliable shipping schedules, and clear product information. This is the case of Amazon and Alibaba, two e-commerce giants which dominate the business-to-consumer (B2C) market and are attracting more B2B customers. But they are not alone: they join an already populated constellation of generalist online marketplaces such as IndiaMart in India and Mercateo in Europe, which supply a broad range of B2B companies.

BUYERS ASK FOR MARKETPLACES

Buyers drive the changes (Clients)

Investment scene is surely very lively. So is the purchase behavior of B2B buyers. Since the COVID-19 outbreak in March 2020, they have become more familiar with e-commerce and hold online suppliers to higher expectations. More than that, a better customer experience and optimized e-commerce platforms would justify a higher purchasing budget, according to B2B shoppers.

CHANGING THE WAY OF PROCUREMENT

Numbers cannot lie (China's example)

In China, the B2B e-comemrce market of industrial goods is forecast to reach 1,750 billion yuan by 2025. This represents a significant increase compared to 2020, when the market did not go over 500 billion yuan.