Question

1. What are B2B exchanges? Are there any successful and viable B2B business models?  Justify your answer by explaining the benefits and limitations to B2B members. I will give upvote if you dont post that's already on internet.

Answer 1

The transactions among business bodies done online through the internet, private network, an intranet, extranet are referred to as B2B e-commerce (Evers et al., 2010). In the private telecommunication networks, B2B commerce was already present. Huge money is required for this network’s operations and infrastructure. The data communication using the internet has turned economical for various firms with the invention of web-based technologies which in turn helps those firms in gaining better efficiency in interaction externally as well as internally.

The huge scope is present in the B2B exchanges or marketplaces in offering various favorable circumstances to automate cooperative trade processes with vendors and clients create in-house processes competencies and attain the latest market at a reasonable price. Below given are the techniques to acquire the benefits of opportunities and stay clear of B2B exchange drawbacks.

Successful and Viable B2B Exchange’s Example

One more example of a creative e-business exchange undertaking is TexYard.com, for the European clothing business, it is an online solution. It is an impartial trading platform for customers and retailers for purchasing and buying clothes in a convenient, fast, and secure manner (Afuah & Tucci 2003). The entire sourcing process can be provided by the buyers in order to reduce their management price, get the best price, and speed up the marketing time. An all-inclusive database can also be utilized by the buyers to search, examine, and initiate functioning with new vendors from various nations. Vendors can approach leading European traders, increase their client base as well as the opportunities. The vendors can promote their products and services, and lessen the price of carrying out their business ((Laudon & Traver, 2016). They can board both reverse and forward auctions; the buyers can mention complete details of the forthcoming production contract with the help of exchange- from specifications related to technical and quality measures to delivery guidelines and shipping and for contracts receiving bids. The time can be lowered considerably spent on interacting requests, tallying quotes, and settling prices.

B2B models Limitation

Restricted Marketing: Selling to the other businesses has very few buyers unlike selling to customers. In this, the maximum number of buyers would count around low thousands and in case of selling to customers, the count of potential buyers would go up to millions (Chaudhury & Kuilboer 2009). Because of this low count, each and every customer becomes important and if any single customer who purchases more opts out of it then the business would suffer to a great extent.

Long Time for Purchase Decision: Mostly two decision-makers are included in most of the consumer purchase decisions and the aggregate purchase decision time likely to run on the short side. The complex set of components is present in the B2B sales cycle including various decision-makers and shareholders with aggregate decision time that may go for many months ((Laudon & Traver, 2016).

Inverted Power Structure: In the range, average clients stay at the leniency of the business when it comes to the item they purchase, the provided facilities and cost indicates the products sell. Buyers have more power than sellers in B2B.

Sales Process: In the conventional method of B2B huge personal time is required, usually various meetings, and gets steered by determinable factors rather than emotional or quality factor which works in B2C.

B2B Business Model Advantages

Long term customer faithfulness results in a decline in prices: The loyalty of customers is higher in B2B than B2C. In B2B, the agreement or contract for commitment is made for a longer duration. It implies less acquiring price and long term customer engagement (Evers et al., 2010). Customers' loyalty can also be boosted by providing customer-oriented products and facilities.

Business Purchases Provides Higher Transaction Value: In B2B, the buyers are companies and they are likely to buy the products in bulk and in huge quantities. The revenues and transaction value gets boosted with this.

The Scope to Extend: The capability to spread the business must be possessed by B2B e-commerce. The optimum thing present in it is that the business possesses the capability to trade in the local place and farther places. The business would get profit and would progress with a huge customer base from various regions ((Laudon & Traver, 2016).

Increasing Awareness Brand with the help of Auxiliary Channel: The more number of people will get to know about the company and thus eventually results in increased customer engagement if the extra channel is introduced. The business can introduce the brands in the market in less time and with efficiency particularly with an optimized search result on the internet of the online business.