B2B e-commerce is moving along generally well for manufacturers, distributors and wholesalers that have an existing technology infrastructure and a website, says new research from e-commerce services provider Unilog Content Solutions Pvt Ltd.

But the survey of 244 companies, including 211 distributors or wholesalers and 33 manufacturers, also notes that B2B e-commerce operators have some ongoing concerns, the biggest of which is the competitive threat posed by Amazon Business. Even though a distributor or manufacturer may have been operating in B2B e-commerce for a while, not everyone has a central strategy that involves all key decision makers, such as from sales, marketing, information technology and senior management.

Scott Frymire

For example, 22% of distributors taking the survey indicate they don’t have a “good” e-commerce strategy. “I think what this indicates is a general disconnection in the investment in e-commerce and having an overall strategy,” says Unilog senior vice president of marketing Scott Frymire. “Many companies are older family-run companies still using older technology even though new workers coming on board may have a more digital mind and skill set.”

Only 25% of online sellers cite fast growth

In general, Unilog survey finds that 72% of companies have an e-commerce site. For those with an e-commerce site, 80% of companies described their B2B web sales as growing, but only 25% of respondents described their online sales growth as “fast,” compared with 54% as growing slowly, 16% with stagnant online sales and 4% with slowly decreasing sales.

One-third of companies see Amazon Business as the greatest threat to their e-commerce business, but 52% of companies don’t have a strategy for dealing with Amazon. “A lot of companies just don’t know what they don’t know and that again suggests the lack of a strategy,” Frymire says.

Total sales for manufacturers, distributors and wholesalers range in size from about $25 million to more than $1 billion. Web sales also are accounting for a growing portion of all sales with e-commerce accounting on average for about 23% of all sales excluding electronic data interchange, Unilog says. For nearly one half of all companies—44%—B2B e-commerce accounts for 20% of sales.

Converting buyers from offline to online

Converting more customers to order online instead of by paper or phone is the top e-commerce strategic priority for 37% of manufacturers, distributors and wholesalers. Other strategic priorities, at 31% and 11% of respondents, respectively, are using e-commerce to generate more incremental sales and integrating with one or several B2B marketplaces. Currently only 5% of survey respondents sell on Amazon, Unilog says.

Other survey findings include:

• Aside from competing with Amazon Business, 15% of companies see economic instability or lack of a central vision as the biggest threat to their B2B e-commerce business, followed by an inability to attract top talent, at 13%, and excessive government regulation at 9%.
• 40% of manufacturers took a year or more to build and launch their B2B e-commerce site. By comparison, 11% took nine to 12 months; 17%, six to nine months; 15%, three to six months; and 16%, three months or less.

“The overall takeaway from the survey is that B2B e-commerce is growing and viable for many companies, but there is more interoperability that needs to take place,” Frymire says.

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