Supplier Enablement

Supplier Enablement pay day

Continuing the debate about who pays for B2B eCommerce here is an interesting parallel with the world of B2C eCommerce (the consumer world of online shopping).

I was thinking about online shopping and the rise in the number of retailers that chargeback to the buyer (you) the cost of your using a credit card to pay for your purchase. Why is that?

I figure that if your online business is all about price competitiveness, and with the ease that the consumer can now perform price comparisons, it is essential to keep out any costs that are not under your control. So, if you choose to pay by credit card and the supplier picks up a 2% fee (average)then they will look to pass that back to you.

Does it stop you shopping online? No, because you like the experience - quick, convenient (24x7), paperless etc. You also know that the online world is keenly price competitive and you get the opportunity to verify that through price comparison web sites and browsing for yourself.

Suppliers also offer alternative ways to pay, using a debit card for example, for which the supplier has a fixed cost to process and they do not pass that back.

The B2C world is rocking and going from strength to strength so are there any lessons for the B2B world?

There are some differences that we have to acknowledge in the B2B world:
+ the law vis a vis consumer rights versus those that govern business
+ in business we are accountability to others (shareholders, stakeholders) + businesses need to keep records (audit, tax etc.)

there are others but you get the picture.

Can we envisage that B2B eCommerce will have the supplier push back costs on the buyer based on how the buyer prefers to buy?

In B2B speak that is; will the supplier push back any costs on the buyer based on how the buyer prefers to deal with the supplier?

Turn that around. Will the buyer push back any costs on the supplier based on how the supplier prefers to deal with the buyer rather then how the buyer prefers? For example, supplier prefers paper invoices whereas the buyer prefers electronic invoices.

There is the dilemma in the B2B world; if you ask to change something the other party might calculate the cost to agree to your change and pass that cost back to you.

What if the change could be demonstrated to be mutually beneficial? Well perhaps that changes things but does require the mentality to understand and agree what matters and is important to the party affected by the change. Even so, this is a good basis to discuss change without the demarcation of who is going to pay.

Think! How can I help you to help me? I need to make some changes so my business improves and that implicates change for you. The good news is that change comes with some useful benefits to you .....

I am reminded of a saying; It is often not what you say but how you say it!

There is psychology at play just as there is around the negotiating table.

Your B2B pay day will be a product of negotiation - so its business as usual - you get what you negotiate.

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posted by FrankB @ Thursday, August 31, 2006