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The digital era of B2B e-commerce

The digital era of B2B e-commerce

If you wanted to buy a pair of jeans ten years ago, you had to go to the pedestrian zone in the city center. You visited several shops, tried on different trousers, compared prices and different offers and then finally picked one out. The whole procedure then often took an entire afternoon.

If you want to buy something nowadays, you can stay at home and order comfortably on the Internet. The product range is wide, from electronics to cosmetics everything can be ordered effortlessly with just a few clicks. In a few days, the postman will ring your doorbell.

Does this sound familiar to you? Are you one of those “online shoppers”?

The development of platforms for online commerce in the B2C sector began already in the 90s with the founding of the sales platforms Ebay (September 1995) and Amazon (July 1994). From a pure mail-order company with a mail-order catalog to a globally operating group, the Otto Group, it was possible to closely follow the development of e-commerce in Germany. Around 20 years and quite a few innovations later, B2B retailing still runs in many companies via fax, telephone, and e-mail.

Jeff Bezos, CEO of Amazon in his 1st office

Jeff Bezos, CEO of Amazon in his 1st office [CNBC]

What opportunities does the platformisation of B2B purchasing processes offer?

A study from the consulting company Arthur D. Little revealed that B2B e-commerce will grow between 2015 and 2019 about 15%. In some sectors even up to 20%. Figure 2 below displays the sales through B2B e-commerce in Germany from 1999 to 2018 as well as a forecast for 2019. Within 9 years, sales grew from 1.1 billion to 53.5 billion euros a year. The forecasts for the future predict further strong growth.

Figure 2- E-commerce grow 1999-2019

Figure 2: B2B e-commerce in Germany 1999-2019

 

That’s not surprising. According to a study by Mintel, 92% of Germans buy online at least once a year. Particularly popular here are clothes and electronics. The no. 1 reason for the booming e-commerce is clear: Convenience! You can order online within a few clicks while sitting on your couch. In a US study, Forrester Research found out that 70% of the respondents consider shopping via digital platforms more convenient. In addition, online platforms often offer lower prices than retailers due to a large number of offers. The big winners are the online giants like eBay, Amazon, Zalando and Co. Ebay and Amazon alone divide 66% of the German market share (2018). The losers are smaller retail stores that can not compete with the platform giants in terms of price. In the city centers more and more shops have to close. In a study by the German Trade Association, 49% of retailers in inner cities say their business has deteriorated dramatically in recent years.

Will digital platforms replace traditional retailing and personal contact with the purchasing department?

The experience of Metalshub, but also of other companies such as Würth or Lekkerland, shows that a good interaction between service, office staff, and digital platforms can create a considerable competitive advantage.  Compared to pure online retailers like Amazon Business and Alibaba, field service vendors have an advantage. For many customers the total package is still decisive: Personal contact and efficient processing via a digital platform.

In another study by the company Intershop, companies were asked if they would benefit from the digitization of business processes. 98% of study participants expect to benefit from digitization in all areas of the value chain. Conversely, this means that companies that deny B2B e-commerce will lose touch in the near future.

What do digital B2B platforms mean for the trading of metals and ferroalloys?

Buyers and sellers want a simple, fair process. At this point, Metalshub offers registered companies, in addition to a digital solution for the purchasing and sales process, personal contact and service to accompany you on the digital journey.

See for yourself and login or register to experience the future of metals trading!
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