0. Chapter 4
B2B E-Commerce

1. B2B E-Commerce Characteristics
Companies attempt to electronically automate trading transactions, communication and collaboration processes in order to improve them.
Manufacturing
Procurement
Raw material shipments
Logistics
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2. B2B
Market forecasters estimate that 2012 global B2B market could reach $15 Trillion

3. Concepts, Characteristics, and Models of B2B E-Commerce
THE BASIC TYPES OF B2B TRANSACTIONS AND ACTIVITIES
Sell-side
Buy-side- Procurement
Exchanges
Collaborative commerce
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5. Complexity of Contract eCommerce
Buy-side Requirements
Procurement
Finance
Logistics
Manufacturing
Engineering
Management
Legal
Info
Services
Inter-enterprise Requirements
Banking
Contract negotiations and transactions
Financing
Escrow
Factoring
Schedule, Delivery Terms, Returns
Form, Fit, Function, Quality
Credit, Payment Terms
Warranties, Schedule, Quality
Service Level Agreements
Logistics
Sell-side Requirements
Sales
Legal
Engineering
Manufacturing
Management
Finance
Info
Services
Business Rules
Inter-enterprise Data
International
Trade Practices
and System
Requirements
Contract
Document
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7. B2B Characteristics Types of B2B Transactions: How Do Firms Buy?
strategic sourcing- Purchases involving long-term contracts that usually are based on private negotiations
spot buying- The purchase of goods and services as they are needed, usually at prevailing market prices
Types of Materials Traded
Direct- materials used to make the product- scheduled purchased in large quantities
Indirect- nonproduction materials MRO- Maintenance, repair, and operation activities
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8. Characteristics B2B E-Commerce
The Direction of the Trades
vertical marketplaces
Markets that deal with one industry or industry segment (e.g., steel, chemicals)
horizontal marketplaces
Markets that concentrate on a service, material, across industry
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9. Relationship Management
Customer relationship management- CRM- integrated online environment for engaging e-business customers and partners
Partner relationship management (PRM)- Corporate customers need to have access to the supplier’s inventory status reports.
Supplier relationship management (SRM)- A comprehensive approach to managing an enterprise’s interactions with the organizations that supply the goods and services it uses.
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10. B2B types of transactions
Sell Side
Buy Side

11. Whirlpool -Sell Side Systems
Whirlpool is a $20 billion global manufacturing corporation.
The want to accomplish
Operate efficiently
Great customer service for their business partners
Partners are located in 170 countries
Middle-tier partners- submitting their orders by phone or fax because they were not large enough to have a (EDI)
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12. Whirlpool -Sell Side Systems
Whirlpool Web World- - B2B trading partner portal
Fast web self-service ordering processes
Saved 80% transaction costs
Reduced operation costs
Improved efficiencies
Launched a B2C portal and realized a 100% ROI in 5 months
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13. Best Buy- Sell Side System
Customers include educational institutions, government entities and SME’s
sell-side systems provided
Search capabilities by key word search
Side-side, feature-by-feature product comparisons
Suggestions for additional items such as accessories and warranties
Up-to-date inventories

14. Buy Side

15. E-Procurement -Buy-Side
procurement management
The planning, organizing, and coordinating of all the activities relating to purchasing goods and services needed to accomplish the organization’s mission

16. E-Procurement Process

17. Inefficiencies Procurement
There is inefficiency in all the major procurement activities.
Qualifying suppliers
Negotiating prices and terms
Building rapport with strategic suppliers. (High value items vs. MRO- wasting valuable time.
Maverick buying- Unplanned purchases of items needed quickly, often at non-pre-negotiated higher prices

18. Benefits of E-Procurement
Lowering purchase prices through standardization
Improving information flow
Improving the payment process
High transparency and information sharing

19. Buy-Side E-Marketplaces
Types of E-Procurement
E-sourcing- identifying new suppliers
E-tendering- receiving supplier bids
E-informing- gathering and distributing purchasing information
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20. B2B Exchanges:
Electronic trading community meeting places for many sellers and many buyers, and possibly for other business partners.
Market Maker- operates the exchange and in some cases may also own it.
Functions of Exchanges
Matching buyers and sellers
Facilitating transactions
Maintaining exchange policies and infrastructure
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21. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

23. B2B Exchanges: Benefits Making markets more efficient
Providing opportunities for sellers and buyers to find new business partners
Cutting the administration costs of ordering MROs
Expediting trading processes
Facilitate global trade

24. B2B Exchanges: Revenue Models Transaction fees Membership fees
Service fees \ Advertising fees
Auction fees

25. Portals and Directories
Internal and External Portals
Business Intelligence portals -business analysis decision support activities

26. Portals and Directories
Corporate portal is a gateway to a corporate website and other information sources that enables communication and access to company information
Provides a focal point for interactions with the firm.
Internal and External Portals
Business Intelligence portals -business analysis decision support activities