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Sponsored by: NeweggBusiness and Amazon Business

WINDOWSOPENING NEW

TO BUSINESS

B2B online marketplaces are

evolving with new offerings, including

data analytics and payment services,

as they and their participating buyers

and sellers expand into new markets.

+ B2B marketplaces cover new ground

+ Amazon Business and NeweggBusiness dive

into government work

+ Fresh produce finds a fresh online marketAPRIL 2017

EXECUTIVE REPORT

B2BeCommerceWorld.com

strategic intelligence for business-to-business professionals

http://www.b2becommerceworld.com

APRIL 2017


EDITORIAL

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April 2017 edition

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CONTENTS

B2B marketplaces like BuildDirect cover new ground . . . . . 3Online marketplaces are becoming more sophisticated in the products and services they offer their buyers and sellers.

Amazon Business and NeweggBusiness dive into government work . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

A restaurant supplier adds a B2B marketplace to the menu . . . . . . . . . . . . . . . . . . . . . . . . . . 23

A new e-marketplace brings farm produce to buyers . . . . . 25

Canon launches an e-marketplace for dealers and their customers . . . . . . . . . . . . . . . . . . . . . . . . . 27

A look at dozens of B2B marketplaces . . . . . . . . . . . . . . . . . . 29

COVER FEATURE

PROFILES

KEY DATA

http://www.b2becommerceworld.com

3Sponsored by: NeweggBusiness and Amazon Business

© Copyright 2017 Vertical Web Media LLC. All rights reserved.

For most companies, selling online takes the mystery out of how and when customers buy, at least in direct transactions. But for the many businesses that rely on marketplaces to build brand exposure and sales, there can be a knowledge void if the marketplace doesn’t provide data on sales volume across multiple products and categories.

“In many marketplaces, it’s a black box—a seller just gets an order and ships it out,” says Erin Magee, vice president of sales for Classic Accessories, a manufacturer of protective coverings for such things as outdoor patio furniture and grills and recreational vehicles.

But since late 2015, as it started selling and later expanded its offerings of coverings through the BuildDirect.com marketplace to consumers as well as businesses, Classic Accessories has compiled data on customer demand that helped it to better plan its production and the product assortments it distributes to hundreds of wholesalers and retailers, Magee adds. As a result, the manufacturer’s total sales for 2016 grew at a double-digit rate over 2015.

“We get strong sales forecasting data, can see who’s viewing products from where, what’s working and what’s not working” in product displays, says vice president of business development

B2B MARKETPLACES COVER NEW GROUND Online marketplaces are becoming more sophisticated in the products and services they offer their buyers and sellers. These portals are expanding internationally and aiming to attract new buyers and sellers by adding such features as payments processing through links with outside providers, reaching international markets, courting government purchasers, and compiling and analyzing data.

BY BILL BRIGGS AND PAUL DEMERY



Shuyler Mowe. “Then we’re able to launch outside of BuildDirect products across various collections that appeal to other distribution channels.”

New marketplaces like BuildDirect.com and its use of big data to help sellers signal a new stage in the progression of business-to-business marketplaces. Today’s marketplaces offer access to global markets and provide new services to sellers and buyers that only fully came into being in the past few years.

Apart from BuildDirect, Classic Accessories traditionally distributed its products to channels ranging from mom-and-pop retailers to large garden centers, catalogers and wholesale clubs. It also designed products and planned assortments according to its forecasted demand from those channels.

Now, with more sales directly to end-customers through the BuildDirect portal—which also sells a wide range of furnishings and equipment for home and office—Classic Accessories can work with its own data on consumer demand as well as on how its coverings can be cross-sold in new product combinations. BuildDirect provides demand information through web analytics and customer surveys that have led Classic Accessories to expand offerings in such areas as car covers in the garage products category and coverings in various sizes to protect stacked patio furniture as well as individual pieces.

Aditi Sood, sales manager at Classic Accessories, says the BuildDirect marketplace is also designed to let sellers quickly upload their own product data and images. Classic Accessories so far has loaded about 500 products. “That lets us get more SKUs on the site to test products,” she says.

BuildDirect specializes in selling large quantities of building materials and finished products per online order for home improvement projects. Now it’s opening up its e-commerce site, BuildDirect.com, to other sellers as a way to expand its selection.

The company, which has been selling directly to home improvement contractors and homeowners since 1999, in 2016 launched Home Marketplace as an e-marketplace where buyers can purchase from a number of manufacturers and distributors of products ranging from roofing and flooring materials to furniture and granite countertops.

Classic Accessories has made more sales directly to the end-consumer since loading its products to the BuildDirect portal.

‘The BuildDirect marketplace lets us get more SKUs on the site to test products.’

—Aditi Sood, sales manager, Classic Accessories

APRIL 2017


B2B Marketplaces: Opening new windows to business



Joseph Thompson, BuildDirect’s head of marketing and growth, says his company is continuing to build out ways for sellers to use marketplace data to improve how they sell and ship products, including bulk orders from overseas suppliers. A seller portal performance dashboard, for example, shows sellers how well their products are performing according to multiple metrics related to buyer demand. “If a seller logs into the portal, they can see on the dashboard how customers are engaging with their products in recent days or the same day,” he says. BuildDirect also uses predictive analytics to project on the dashboard demand for a seller’s products.

In addition, BuildDirect’s new Gateway shipping network—encompassing more than 2,500 ground carriers and five ocean freight services—provides data on the lowest-cost and fastest means of shipping via these carriers bulk orders averaging 1,500 pounds. The service can handle shipments to individual homeowners as well as to building contractors and multiple locations of corporate operations. BuildDirect is making the Gateway shipping and data services available to other marketplaces as well as to the participants on its own portal.

BuildDirect is but one example of a business taking advantage of B2B marketplaces opportunities. Following are a few examples of the expanding importance of these portals:

DIRECT SALES OPPORTUNITIES FOR MANUFACTURERS

B2B manufacturers have taken only minimal steps in direct e-commerce because of “concerns over lack of experience with e-commerce, costs associated with building the required technology and potentially alienating their distributors, or channel conflict,” according to a new report titled “Manufacturers Reap Benefits From Selling Direct.” The report, compiled by Forrester Consulting and commissioned by marketplace

The six tear-drop icons on the map show BuildDirect’s main distribution locations; the blue icons show where a particular seller has most of its inventory; the pink, yellow and red colors show that seller’s customer demand, with red the strongest. The metrics at right relate to the seller’s volume of product views, carted products, completed orders and forecasted demand.

‘A seller can see on a dashboard how customers are engaging with their products.’

—Joseph Thompson, head of marketing and growth,

BuildDirect

APRIL 2017



Growing sales with Newegg’s B2B marketplace

As shown by the increase in the number of business-to-business marketplaces in recent years, demand today is growing for products

sold on them. And the range of products extends beyond general business and industrial products to include equipment and supplies designed for such market segments as government agencies, healthcare organizations, educational institutions, and value-added resellers of computers and other technology products.

B2B e-commerce marketplaces typically allow buyers to search among a wide assortment of products from many suppliers. Many B2B marketplaces also allow the seller to design and manage their own promotions, helping them to better reach a global audience.

Newegg’s own history in offering both retail and B2B e-commerce illustrates the increased demand for an expanding range of products on B2B marketplaces. Newegg launched NeweggBusiness.com in 2009 to address the demands of customers on its retail site, Newegg.com, for such B2B services as the ability to buy in bulk and at contracted pricing, says Sophia Tsao, vice president and head of marketplace for NeweggBusiness.

NeweggBusiness started out by selling its full catalog of products, but focusing on Newegg’s two largest categories—I.T. hardware and consumer electronics. In 2014, NeweggBusiness launched its marketplace, providing a wider range of business products and services sourced from third-party sellers as well as from NeweggBusiness itself.

As a result, Tsao says, the range of items offered on NeweggBusiness.com has expanded into such catego-ries as automotive, industrial tools and office supplies, in addition to a wider selection within Newegg’s core categories of I.T. hardware, computers and electronics. NeweggBusiness now offers some 4.5 million products, she says.

HYBRID BUSINESS PLATFORMAn important characteristic of Newegg’s B2B e-commerce marketplace is their hybrid business model—1P and 3P channels. Sellers can either have the marketplace manage the seller’s product sales (1P model) or allow the sellers to manage it them-selves while listing on the marketplace (3P model). By leveraging a combination of both, sellers can promote the right product assortment in the channels that make most sense for their business.

FLEXIBLE PROMOTION OPPORTUNITIES B2B marketplaces also provide co-marketing services to suppliers. Within NeweggBusiness.com there are three programs for clients: A seller can list their own product in the portal on

NeweggBusiness.com and use their own marketing and promotional resources to develop, for example, a simple promo code for free shipping or special discounts on particular products; NeweggBusiness can publicize a seller’s products

through email and other weekly promotions; NeweggBusiness will feature a seller’s products on

its homepage. A flexible sales platform is core to what B2B sellers

want in e-commerce marketplaces, but they also look for that crucial integration with back-end software for such operations as meeting transaction security and regula-tory requirements. For example, NeweggBusiness.com is licensed by the U.S. General Services Administration, which means it has met all compliance requirements for selling products to federal government agencies. NeweggBusiness meets the GSA’s requirement that it provide government agencies an automatic 1% discount on electrical products.

Finally, adding human interaction is important to both buyers and sellers, especially in a web-centric world. NeweggBusiness, for example, has a large team of customer service professionals trained to help online buyers select products and address any post-sale support needs. This team also works with sellers to address any concerns they have regarding the platform or promotional programs. “We are proud of our human touch,” Tsao says. It has paid off: Newegg’s B2B market-place has seen tremendous growth since its inception. Their double digit year-over-year growth is a microcosm of what looks to be a promising industry moving forward.

SPONSORED SPOTLIGHT

Sponsored by:

NeweggBusiness

https://www.neweggbusiness.com/sellers

https://www.neweggbusiness.com/sellers



technology vendor Mirakl and SAP Hybris, a B2B e-commerce technology company, evaluates B2B manufacturers’ adoption of hosted online marketplaces and the associated benefits.

Of 125 e-commerce and marketing executives surveyed from medium and large B2B and B2B-to-consumer manufacturers in the U.S., United Kingdom, France and Germany, many have taken only half-steps toward enabling e-commerce for end customers. The study showed 53% of companies say they are selling on unidentified third-party marketplaces or through channel partners, but that relying on resellers “interferes with the business’s control of the customer experience and reaping valuable customer data and insights.” Yet manufacturers that sell on marketplaces say they are “more confident” in their abilities to execute critical functions through direct marketplaces.

CAPITAL IS FINDING MARKETPLACES

Tradeshift, a growing global B2B e-marketplace received $75 million in a Series D round of venture capital funding from new and prior investors in mid-2016. Tradeshift has raised a total of $174 million in venture capital, according to business information firm Crunchbase. Tradeshift, which says it has more than 800,000 users worldwide, including buyers and sellers among the Fortune 1000, will use the new funding to “serve a wider range of global customers” and expand its services in such areas as supply chain financing, procurement software and online payments, the company says. The funding round was backed by Data Collective, HSBC, American Express Ventures, Notion Capital and CreditEase Fintech Investment Fund.

Prior to the latest funding round, Tradeshift made a number of improvements, the company says, including expanding the range of products buyers on its plan can purchase under spend-

53% of B2B companies say they are selling on unidentified third-party marketplaces or through channel

partners, but relying on resellers “interferes with the business’s control of the customer experience and reaping valuable customer data and insights.”

Buyers and sellers can exchange electronic purchase orders and invoices through Tradeshift.

APRIL 2017





management programs; enabling buyers and sellers to exchange electronic purchase orders and invoices, and gives them the option to complete payments through such online payment systems as PayPal and Intuit Payments; and a service buyers and sellers can use to check the financial viability of new trading partners.

AMAZON BUSINESS IS HIRING

Amazon Business has already made a mark on the world of B2B e-commerce, reporting it surpassed $1 billion in sales during its first full year of operation. While it’s widely recognized as a major force driving other sellers to build and perfect B2B e-commerce sites and marketplaces, Amazon.com Inc. thinks its B2B site still has a ways to go to reach its potential. “It is still very much Day One for Amazon Business,” Amazon says. It is still focused, it adds, “on building solutions that enable B2B customers to find, research, and buy products and services.”

Those quoted comments were pulled not from a statement by an Amazon executive, but from a job description listed recently on Amazon’s own recruitment website for a senior program manager for Amazon Business. It’s one of dozens of job openings at Amazon Business, according to a search for “Amazon Business” on Amazon’s job site, Amazon.jobs. The company is on record with plans to fill up to 100,000 new jobs in the U.S. by mid-2018, but a spokeswoman says Amazon doesn’t break out the total number of current openings at Amazon Business or how many of the new positions will be dedicated to the B2B site.

PAYMENT OPTIONS MULTIPLY

Amazon Business is one of the B2B marketplaces offering payments services, in this case for buyers. It’s easy enough for a procurement agent to buy a lot of stuff on e-commerce sites, but often a lot harder to access, manage and analyze the payment data associated with those transactions. Visa Inc. and Amazon Business have teamed up to make life easier for those buyers.

Amazon Business surpassed $1 billion in sales during its first full year of operation.

‘It is still very much

Day One for Amazon

Business.’

APRIL 2017





They have agreed to provide businesses with purchasing accounts on Amazon Business with access to data tied to purchases made with Visa Commercial cards. The free service is designed to let buyers access full line-item details of purchases made on Amazon Business to reconcile or audit their financial records, regardless of how many suppliers they purchased from. Amazon Business features products sold by some 45,000 sellers in addition to Amazon.com itself.

“Tracking and reconciling online purchases made with commercial cards can be a time-consuming task,” says Vicky Bindra, global head of products and solutions at Visa Inc. “Visa’s collaboration with Amazon Business and our bank partners will ultimately help our commercial account holders in the U.S. spend less time on reconciliation of their purchases and allow more card management options.”

Visa and Amazon Business announced the new service in April, noting that it will initially be available for Visa Commercial cards issued by three banks—Bank of America Merrill Lynch, Citibank and PNC Bank N.A.—before being rolled out to other Visa card issuers. The service also provides for delivery of payment transaction data—including item description and name of vendor, the invoice number, number of units purchased, order date and shipping address—to a client company’s financial management application within its own enterprise resource planning system.

“B2B payments require enhanced data for proper audit, reporting and purchasing control,” says Morgan Salmon, global commercial cards B2B product head at Citi Treasury and Trade Solutions.

Jennifer Petty, head of Card and Comprehensive Payables for Bank of America Merrill Lynch, says her bank sees increasing

‘Tracking and reconciling online purchases made with commercial cards can be a time- consuming task.’

—Vicky Bindra, global head of products and solutions, Visa Inc.

APRIL 2017



How companies grow on Amazon Business

When Amazon Business launched in 2015, it addressed the demand from Amazon.com customers “who loved the online consumer

experience and were looking for a similar shopping experience at work,” says Rob Green, director of sales. He adds that, by offering online procurement features designed for business buyers—such as quantity discounts and negotiated pricing—Amazon Business opened up a B2B marketplace where business buyers can take advantage of the trusted, customer-centric approach of Amazon.com.

Several businesses of different sizes and product categories say Amazon Business increased their sales.

INCREASED VISIBILITY Cole-Parmer, a manufacturer and distributor of laboratory, fluid-handling and envi-ronmental testing equipment, says the exposure of its products to Amazon Business’s large customer base is helping Cole-Parmer’s growth in sales. In addition, administrative tools on the site allow the company to pre-verify buyers as from reliable businesses. Cole-Parmer also is able to set custom online pricing for each of its online customers.

BROADER AUDIENCE Owens & Minor Inc., a distributor of healthcare products, has expanded its sales efforts to include e-commerce marketplaces. The company says it is able to reach a broader audience on Amazon Business, while also reaching more of its targeted base of buyers, many of whom, it found, were already using the marketplace.

MARKETING, SHIPPING AND CUSTOMER SERVICE Women-owned small business Stand Steady, a designer, manufacturer and distributor of standing desks and other ergonomic office furniture and supplies, says it benefits from having its products seen by more busi-ness buyers on Amazon Business. Also, by selling on the marketplace, Stand Steady eliminates warehouse management and other operating costs as Amazon processes and ships orders, runs advertisements, takes customer service calls and handles returns.

A VIRTUAL SALES TEAM Answering its need to sell prod-ucts without a physical sales team was key to the decision by G7 Power, which produces LED light bulbs, to sell on a B2B e-commerce site. As a small start-up, the firm

took advantage of selling products on Amazon Business, knowing it could reach a large, diverse audience cost-effectively and leverage Amazon’s online reputation.

Amazon Business had a jumpstart on many B2B e-commerce sites as it already had a large base of business customers on Amazon.com, a well-known brand with a battle-tested technology infrastructure. Amazon Business goes beyond Amazon.com, however, by providing such fea-tures as business pricing, quantity discounts and access to data analytics tailored to both business buyers and sellers to facilitate the corporate procurement process, Green says. Sellers are helping to expand the range of inventory available on the site by adding products “across a broad set of business-relevant categories on a daily basis,” he adds. Today Amazon Business offers over 10 million products with business pricing from some 45,000 sellers.

Amazon Business is also developing business-specific merchandising packages and marketing calendars. For example, throughout the year it will run campaigns such as Women’s History Month and Veterans Day, featuring credentialed sellers. A Back to Business campaign at the beginning of the year was designed to help “business customers stock up on important inventory when the calendar turns over,” Green says.

Looking forward, Green says “we’re excited about our global expansion, as we launched Amazon Business in Germany last December, the U.K. in April and are getting really positive responses from customers and sellers. We’re also excited about our customer acquisition efforts in the Healthcare, Government and Education spaces, all of which bring a tremendous breadth of opportunity to sellers, based on the deep product baskets that these types of customers are looking for on Amazon Business. It’s still Day One for us, but we’re seeing encouraging signs that business customers of all sizes are delighted by our efforts.”

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Over 400,000 registered business accounts

Reach more. Sell more. Amazon Business is growing its network of business buyers, including:

Business Pricing tools to grow your sales

Profile and Credential features to tell your business’s story

Sell on Amazon BusinessThe B2B Marketplace on Amazon

See how Amazon can grow your business.

Start selling ›

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demand for the service as businesses rely more on web shopping portals like Amazon Business to make more of their purchases. “As organizations’ buying patterns move toward online marketplaces, access to this critical data will help with reconciliation and audit,” she says.

Other providers of B2B payment services are breaking new ground. Basware Corp., for instance, is growing the number of suppliers and buyers on its Basware Network as it expands its services for companies to exchange purchase orders and invoices and process payments. Over the past few years, Basware has launched services including Basware Pay—designed to let mid-sized companies process B2B payments through the MasterCard network. A program for buyers, Basware Discount, allows them to set up early payments to suppliers in return for a discount on invoices.

In the past year, the number of suppliers participating on the Basware Network increased about 16%, says Mikael Mangs, vice president of Network & Financing Services. The Basware Network has more than 1 million connected buyers and suppliers. Its volume of transactions have increased in double-digit percentages over the past three years, with 2016’s volume reaching more than 100 million transactions with a gross value of close to $550 billion, he says.

BRIGHTER LIGHTS SHINE ON BIDSLATE.COM

For some marketplaces, the ability to manage online payments between buyers and sellers can make a huge difference in their ability to succeed. Take BidSlate, an international marketplace launched in October 2016 for buyers and sellers of the distribution rights of feature films and other forms of media content.

In its first six months of operation, BidSlate has offered hundreds of buyers (also known as distributors) about 150 films, including

Purchase orders and invoices can be exchanged on the Basware Network, which also provides related analytics.

APRIL 2017





the dramas “Apocalypse Child” and “Americana” and comedies “Fighting Belle” and the Spanish-language “Piter Pan.” Other genres include adventure, horror, thriller, sci-fi, western, LGBTQ and documentary. BidSlate already serves hundreds of buyer-distributors from nearly all parts of the world, and hopes to expand its marketplace activity to include thousands of content titles and thousands of buyer-distributors, co-founder and CEO Roland Rojas says.

One key to its growth, he says, is simplifying the complicated method of how buyers pay for distribution rights they acquire from filmmakers. Buyers typically either pay a flat fee up front on receipt of content, a minimum up-front payment followed by revenue sharing as buyers re-sell the content, or just share revenue. Traditionally, such payments have been made offline with paper checks, requiring extensive paperwork and bill-collecting, Rojas says. “It’s complicated,” he says.

When planning BidSlate’s launch, Rojas and his film industry partner decided to start with an electronic payment escrow system that would not only cut out the paper checks, but instill more confidence among internationally dispersed buyers and sellers who may not know each other. Regardless of the payment schedule, funds from the buyer-distributors on the marketplace are held in escrow by Payoneer, BidSlate’s payment services provider, and released to sellers once the buyers receive the content under their agreed-upon terms. Under the revenue-sharing model, Payoneer receives the funds from the buyer-distributors’ end-customers, then disperses it to the buyer-distributor and filmmaker according to their revenue-sharing terms. BidSlate retains 20% of each transaction as its own fee.

Rojas says BidSlate is taking other steps to help its marketplace grow among both buyers and filmmakers. Its e-commerce platform at BidSlate.com, which it built in-house, for example, was designed with a site search tool that lets buyers look for content by genre or other criteria that meets their programming interests.

But he says he can’t imagine having to directly get involved in managing payment transactions. “We’re a marketplace,” he says. “We don’t want to touch the funds going between buyers and sellers. We only want to touch what belongs to us.”

‘We’re a marketplace. We don’t want to touch the funds going between buyers and sellers.’

—Roland Rojas, CEO, BidSlate.com

APRIL 2017





Rojas says it took about two months for his internal I.T. team and Payoneer to set up the escrow service on BidSlate.com. Buyers on BidSlate, he says, take about five minutes to fill out an online form to begin using the escrow service.

Payoneer, which charges no fees to integrate its technology into marketplaces, charges its clients a percentage of transaction value starting at 1.5% for transactions valued at under $5,000, according to Payoneer CEO Scott Galit. The rate goes down as transaction value rises. For a marketplace generating sales of more than $1 million, the rate is 0.35%.

B2B MARKETPLACES GOING MORE GLOBAL

B2B marketplaces are also looking to grow their global reach. For example, Newegg Inc., a retailer of technology products, is helping third-party sellers sell more to its consumer and business customers in the United States and abroad.

After launching as a web-only retailer of computers and other electronics products in 2001, Newegg grew quickly to $1 billion in sales by 2004 and $2 billion by 2008.

Now it’s striving to go well beyond $3 billion, a threshold it inched past in 2014 with combined retail and business-to-business sales. Part of its strategy now is to build more international sales, as it helps sellers throughout the world sell to more than 32 million customers across the United States, Europe and Asia.

Newegg sells to businesses on NeweggBusiness.com, and to consumers on Newegg.com. It’s taking several steps to bring more sellers and product categories to each, including such new categories as automotive products that it sells to repair shops and company fleets on NeweggBusiness.com.

In the meantime, Newegg is also working with sellers worldwide to build up their sales to North American customers on NeweggBusiness.com and the retail site Newegg.com.

Newegg works with overseas sellers to help them test sales in the U.S. and other markets, helping them with marketing campaigns that can gauge demand for a new product before committing to sell large quantities through Newegg’s retail or B2B sites. It also

Payoneer provides escrow services to buyers and sellers of feature films and other forms of media content on BidSlate.com.

Repair shops and company fleets can purchase automotive products on NeweggBusiness.com.

APRIL 2017





offers logistics services through its Shipped by Newegg program, through which Newegg will hold inventory for third-party sellers, ship orders to end-customers, and handle customer service and returns.

In addition to the United States, Newegg.com currently ships to customers in Singapore, the United Kingdom, Ireland, Netherlands, Poland, India, Australia and New Zealand. The company looks to expand its reach in such regions such as Asia Pacific, Europe, Latin America, and the Middle East.

AMAZON BUSINESS BUILDS IN EUROPE

Amazon Business went a step further in its global expansion in April, adding a British B2B marketplace to its European territory targeting an online B2B market estimated by the U.K.’s Office for National Statistics at more than $120 billion.

The site, at Amazon.co.uk/business, features more than 100 million products ranging from office and janitorial supplies to electric motors and metal-cutting drills for companies of all sizes, says Bill Burkland, head of Amazon Business UK.

Amazon hasn’t released figures on the numbers of buyers and sellers on the U.K. site, though it notes on the site that U.K.-based businesses already selling on Amazon marketplaces were “expected to achieve export sales of more than 1.8 billion pounds in 2016, up 29%” from 1.4 billion pounds the prior year. 1.8 billion pounds is equivalent to $2.24 billion.

Amazon operates 11 e-commerce marketplaces worldwide, including Amazon.co.uk, where it and thousands of other companies sell to consumers as well as to businesses. Its Amazon Business portals now operate as extensions of

£ 1.8 billionExpected 2016 export sales for U.K.-based businesses already

selling on Amazon marketplaces,

up 29%from the prior year.

APRIL 2017





Amazon marketplaces in the U.S. and Germany as well as in the U.K. The Amazon Business portals differ from the broader Amazon marketplaces in the features, including pricing and business account services, they offer specifically for business buyers and sellers.

On the new U.K. site, for instance, Amazon Business provides features designed for U.K. businesses including VAT-exclusive pricing, which shows buyers the price of goods without the inclusion of value-added tax. In the U.K. and other European countries, it’s common to apply a VAT that manufacturers, distributors and retailers each collect and submit to their local taxing jurisdictions after the final sale to an end-user. Amazon Business also offers VAT invoicing, which displays records of the tax that businesses use when filing tax returns, and exclusive pricing that sellers can offer to business customers, including discounts for volume purchases.

The Amazon Business U.K. site, like other Amazon sites, also provides sellers the option to use Fulfillment by Amazon to fulfill orders through Amazon’s own network of distribution centers, including 12 in the U.K. out of more than 100 worldwide. And it allows buyers to use the Amazon Prime service for 2-day shipping.

“Whether you are a sole trader, a buyer in a mid-size company or a chief procurement officer in a large multinational organization, Amazon Business has the products and capabilities to serve your needs,” Burkland says. “Amazon Business combines more than one hundred million business products with a new set of unique business features—from reporting and analytics to spending limits and purchasing workflow approvals.”

The launch of the newest Amazon Business site has stirred various responses from businesses in the U.K. “We are very excited about Amazon Business, which will simplify sales for us and allow us to make our offers more attractive to institutional

‘Amazon Business combines more than one hundred million business products with a new set of unique business features—from reporting and analytics to spending limits and purchasing workflow approvals.’

—Bill Burkland, head of Amazon Business UK

APRIL 2017





buyers through business-specific pricing,” Dariusz Dubis, a director at Microdream Ltd., a firm certified by Microsoft Corp. to refurbish computer products, says in an online testimonial.

Others are more wary of Amazon’s presence. In preparation for Amazon Business’ expected arrival, SPOT Group, a wholesaler of business supplies under the Spicers brand, has been upgrading its own distribution center network and delivery services over the past two years to be more competitive, CEO Jeff Whiteway said late last year.

The U.K. Amazon Business site is the second in Europe and follows the December launch of Amazon’s B2B portal in Germany, at Amazon.de/business. More than 50,000 business customers and 10,000 sellers now use the Germany-based Amazon Business portal, Amazon says. “Building on this success, we are now offering Amazon’s selection, convenience and value to businesses in the U.K.,” it says on the new U.K. Amazon Business portal.

Amazon Business has unmatched resources to back up its plans, but B2B marketplaces of all sizes are proving that buyers and sellers are open to new ways of doing business.

‘Amazon Business will allow us to make our offers more attractive to institutional buyers through business-specific pricing.’

—Dariusz Dubis, director, Microdream Ltd.

APRIL 2017





Buyers at tens of thousands of public agencies and nonprofit organizations can now procure a wide range of products on Amazon Business—including items ranging from books and art supplies to scientific equipment and animal supplies—under a contract announced in February by U.S. Communities, a buying cooperative for more than 55,000 public-sector agencies.

For Amazon Business, the deal could reach a value of more than $5 billion over a little more than a decade.

The contract is for Amazon Business to provide an “online marketplace for the purchase of products and services” under procurement terms providing participating agencies with such benefits as discounted pricing for combined order volumes, and low administrative costs resulting from the use of state-of-the-art order management and delivery systems. U.S. Communities member agency Prince William County (Virginia) Public Schools, acting as the lead agency, awarded Amazon Business the contract in January 2017 after issuing a request for proposals in September 2016 and considering eight other proposals in addition to Amazon’s.

The contract was set for an initial five-year term that began on Jan. 19, with options to renew it for three two-year periods, for a total of up to 11 years. The bid document estimates spending by participating agencies of $500 million per year under the contract, or Master Agreement, with Amazon Business; if that

DIVING INTO GOVERNMENT WORK—AND TARGETING BILLIONS OF DOLLARS

Marketplaces Amazon Business and NeweggBusiness found a new way to serve the country earlier this year by contracting

with government agencies and educational institutions.

BY PAUL DEMERY



spending volume occurred over the course of 11 years, it would result in a cumulative volume of $5.5 billion.

“Amazon Business delivers the buying experience our end-users want, and we are thrilled to provide the contract vehicle for this extensive nationwide online marketplace,” Anthony Crosby, administrative coordinator of purchasing for Prince William County Public Schools, said in a statement.

Prentis Wilson, vice president of Amazon Business, added: “Amazon Business is committed for the long term to serve education and government organizations, and is honored to partner with Prince William County Public Schools and U.S. Communities to offer a contract solution for the public sector.”

The contract, which U.S. Communities ensured was solicited and awarded under public procurement rules and regulations, extends to all of the cooperative’s member agencies. It covers 10 product categories: office supplies; classroom, school, art supplies and materials; home kitchen, food and grocery; books; musical instruments; audio visual and electronics; higher education scientific equipment and lab supplies; clothing; animal supplies equipment and food; and miscellaneous.

Amazon Business is one of many companies contracted by U.S. Communities’ agencies to provide its members with products and services. The buying cooperative lists on its website dozens of sellers under four specific categories—including The Home Depot Pro and electrical products distributor Graybar under the Facilities category; furniture suppliers Virco, Haworth and Herman Miller under the Office & School category; office machines suppliers Ricoh and Savin under the Technology category; and Advance Auto Parts and analytics software provider Experian under the Specialty category.

But Amazon Business is the only contracted company listed as an online marketplace, and it’s the only company that appears under each of the four categories. Indeed, the estimated $500 million in annual spending under the Amazon Business contract is nearly a

USCommunities.org displays many of the suppliers it makes available to buyers at public agencies.

APRIL 2017





quarter of the “over $2 billion” in products and services that U.S. Communities’ participating agencies already procure annually, according to figures on the cooperative’s website.

The U.S. Communities website includes a marketplace section, linked from a Shop button on the site’s navigation bar, where authorized buyers can use a single shopping cart to purchase products from any number of the contracted suppliers.

U.S. Communities charges its member agencies no fees and requires no minimum order volumes. The cooperative has been running webinars to instruct member agencies how to take advantage of the Amazon Business contract. The contract lets buyers register for tax-exempt purchasing, free two-day shipping on eligible orders valued at $49 or more, and use punchout software that enables buyers to link directly to Amazon Business from procurement software systems including SciQuest, Skyward, ESM and Coupa, the cooperative says.

Amazon Business has taken several steps to grow its sales to schools, government agencies and other public sector organizations. It includes a product section on its site for educators, and provides teachers with a free digital content service, Amazon Inspire. Last September, around the time the Prince William County Public Schools issued its request for proposals, Amazon Business hired Anne Rung, the former head of the U.S. Office of Federal Procurement Policy, as its global head of public sector sales. And its plans to expand its workforce recently included a job posting for a head of government markets.

NEWEGGBUSINESS SETS UP SHOP WITH THE GSA

Launched in 2009 as the business-to-business arm of electronics retailer Newegg, NeweggBusiness surged to nearly $600 million in sales in 2016. Now it’s in a position to grow in a new market—the federal government—through a recent contract with the U.S. General Services Administration, making it an authorized vendor to federal agencies of a broad range I.T. products.

“As a holder of a GSA Schedule Contract, NeweggBusiness is now a preferred source for government buyers,” Newegg Inc. CEO Danny Lee says. “This milestone positions the company to earn government contracts and tap new public sector revenue streams.”

‘Amazon Business is committed for the long term to serve education and government organizations.’

—Prentis Wilson, vice president, Amazon Business

APRIL 2017





NeweggBusiness, No. 115 in the B2B E-Commerce 300, already has experience in selling to government agencies at the state and municipal levels. With its GSA contract, which covers a general range of I.T. products, systems and services, NeweggBusiness can now sell things ranging from telephones and video teleconferencing equipment to computers and computer networking equipment to any person authorized to procure products for a federal government agency.

The GSA eLibrary’s website, where the agency records contract details, lists the NeweggBusiness contract as pertaining to “general purpose commercial information technology equipment, software and services” under I.T. Schedule 70. The GSA refers to I.T. Schedule 70 as the “largest, most widely used acquisition vehicle in the federal government.” The NeweggBusiness contract is listed as running until Nov. 28, 2021.

Jim O’Dowd, vice president of NeweggBusiness, declines to identify the products the company is immediately making available under the GSA contract, but says the retailer plans to expand its offerings to suit federal government agency demand. “We have started with a limited assortment and will expand it opportunistically,” he says. “We do not expect to make any major inventory investments at the onset but may do so as opportunities arise. Our website will recognize GSA buyers and as a result will support the needs of GSA.”

He adds that NeweggBusiness sees the GSA contract as a significant opportunity to build on its traditional sales to state and local government agencies. “We will expand our public sector sales, marketing and support teams to attack this important market segment,” he says.

NeweggBusiness provides more details on its website about the GSA contract and how government procurement officers can contact the retailer and get contract pricing.

NeweggBusiness is a wholly owned subsidiary of Newegg North America Inc.

NeweggBusiness promotes its GSA contract.

‘We will expand our public sector sales, marketing and support teams.’

—Jim O’Dowd, vice president, NeweggBusiness

APRIL 2017





American Energy Restaurant Equipment is a growing business with a new retail showroom for business customers, but has no e-commerce capability and relies on a limiting array of marketing methods—mainly printed flyers and email—to promote its wares. Automation is about to come to the rescue, says Kathleen Wilkie, vice president and in-house counsel.

American Energy’s customers are mostly individual restaurants and local chains, and include delis, white tablecloth eateries, day care centers, schools and caterers, Wilkie says. The company expanded in 2016 and opened a retail “depot” for walk-in customers and a showroom to display big-ticket items such as ovens and dishwashers that can cost $4,000-$6,000, as well as smaller items. Smaller products—“smallwares”—range in price from $4 to $40 and include spatulas, knives and aprons, she says.

The supplier expected to be selling products online at CleanDishes.com in early 2017, pending rollout of services from ePurchasing Network, a procurement network vendor. The e-commerce hub will enable customers to get product information from a variety of manufacturers on equipment and related items, place and track orders, and eliminate potential errors associated with manual ordering, Wilkie says.

American Energy will use the ePurchasing Network platform to stock its new retail depot and to manage repeat orders of smaller supplies, as well as to provide an e-commerce portal. “We look for the platform to help us move those products and provide a reorder mechanism for our customers,” Wilkie says.

The network will address several challenges inherent in selling commercial restaurant equipment, she says. First, the e-commerce site will make it easy for customers to shop when it’s convenient for them. Restaurant owners and managers typically work long days, from early morning shopping for fresh food to

A RESTAURANT SUPPLIER ADDS A B2B MARKETPLACE TO THE MENU BY BILL BRIGGS



days ending at midnight, Wilkie says. “We can provide a way for them to shop when they can,” and run promotions as well.

The website also helps free up salespeople to concentrate on equipment. “We see it as a supplement of our sales team that makes reorders easy without the rep being right there,” Wilkie says. American Energy also expects the platform to lower transaction costs on those smaller items.

EPurchasing Network launched its e-commerce platform in December, targeting the commercial restaurant equipment industry, which CEO George Spears says is mature and lagging in adopting e-commerce technology. The vendor provides B2B marketplaces for commercial equipment manufacturers and dealers in a cloud-based, “platform-as-a-service” format, which provides clients with APIs to connect their web portals with e-commerce tools. The e-commerce tools are designed to streamline equipment sales, order management and marketing for commercial food service firms, Spears says. The vendor plans to target other industries soon, he says, including aerospace, medical products distribution and construction.

The network is designed to offer manufacturers access to new dealers and to automate the purchase order process, thus eliminating redundant order entry and potential errors along the way, Spears says. The vendor offers manufacturers an e-catalog service, which can automatically update product pricing and descriptions based on feeds from the manufacturer. Manufacturer sales reps can access that product information on mobile devices, giving them up-to-date product information wherever they are.

Other product data accessible on the platform includes images, spec sheets and warranty information, Spears says.

The vendor charges manufacturers a monthly membership fee. Dealers pay for initial set-up and transaction fees based on number of SKUs and the dollar volume of sales going through the platform, Spears says. He declined to disclose specific fees.

EPurchasing Network dealer clients in the restaurant equipment field together have relationships with 30 manufacturers, Spears says. Rollout typically will take 30 to 60 days, depending on whether the manufacturers have data on hand and ready to upload or if the vendor manages the data preparation.

APRIL 2017





Duncan Family Farms raises organic fruits and vegetables on four farms with a total of 9,000 acres in Arizona and California. Now for the first time it’s selling on the web to retailers and other bulk buyers.

Late in 2016 Duncan became a supplier on Aggrigator.com, Aggrigator Inc.’s new internet portal that connects growers with grocers, restaurants and institutional kitchens. “The Aggrigator marketplace technology and business model enable us to access markets and expand our supply chain footprint to keep pace with growth,” says Duncan Family Farms president Will Feliz. He adds that Duncan will sell on the web marketplace its products that are packaged in bulk cartons.

Feliz says that Duncan Family Farms was attracted to Aggrigator’s mission of making the fresh-produce market more available to both buyers and sellers of all sizes. In addition to serving as a portal where buyers and sellers can meet and process purchases, Aggrigator also provides a network of financial and transportation services firms to help its clients complete their transactions.

Duncan Family Farms is making the move to e-commerce at a time when U.S. demand for organic food is growing at a double-digit annual rate, according to the U.S. Department of Commerce, which says organic products now account for 4% of U.S. food sales. U.S. organic food sales grew 11% to $43.3 billion in 2015, says the Organic Trade Association.

“We said, ‘What if we could build a technology that would aggregate demand from small buyers and suppliers who don’t have easy access to big markets?’ We make that easier,” says Gerard Rego, co-founder of Aggrigator. The marketplace was conceived by Rego and his team in January 2014 as a portal for farmers and food buyers to find one another. Duncan Family

A NEW E-MARKETPLACE BRINGS FARM PRODUCE TO BUYERS BY TIM BRUSVEEN

In addition to serving as a portal where buyers and sellers can meet and process purchases, Aggrigator also provides a network of financial and transportation services firms to help its clients complete their transactions.



Farms is among the initial sellers on the site, which Rego says was expected to go fully live in early 2017.

Once buyers register on Aggribuy.Aggrigator.com, the marketplace shows them available items based on their product preferences. Orders on Aggrigator to date range from $300 to $11,000, he notes.

Aggrigator collects a percentage of the value of transactions processed on the marketplace. Rego declined to specify the amount the marketplaces charges. All orders between buyers and sellers can be placed online and payments are processed through PayPal.

APRIL 2017





Canon U.S.A. Inc. has a new online marketplace that consolidates its imaging technology and services offerings on one landing page accessible by authorized dealers.

Canon says the portal, dubbed the Canon Business Services Platform, will help dealers enhance customer relationships by making it simple to order subscription-based Canon document and information management products—such as software, services and imaging equipment—and to access support information about products and services.

The marketplace launched in August 2016 and is part of what Canon U.S.A calls “One Canon,” its centralized strategy to unite its business-to-business divisions and create a tighter bond with its dealers. At a presentation to industry analysts last year, Leo Bonetti, CEO of Flo-Tech, a Canon authorized dealer and service provider, offered an example of how his organization worked with Canon to meet the needs of its customers. Flo-Tech client RSM International, an audit, tax and consulting firm formerly known as McGladrey, wanted to upgrade its printers and the dealer and Canon worked out a plan to do so, Canon says.

RSM now has nearly 500 Canon printers using Canon’s uniFlow software across its offices in the United States, providing RSM with improved workflow in a high-volume office environment, Bonetti says.

UniFlow software provides print, copy and scan control of a network of devices that can track device usage to control costs, add password-protected printing and implement web-based print/copy job submission, Canon says. UniFlow and other software is provided online through a software-as-a-service format. In the SaaS model the vendor hosts the technology and

CANON LAUNCHES AN E-MARKETPLACE FOR DEALERS AND THEIR CUSTOMERS BY BILL BRIGGS

The Canon Business Services Platform will help dealers enhance customer relationships by making it simple to order subscription-based Canon document and information management products.



clients access it via a web browser, paying monthly subscription fees instead of large, lump-sum licensing fees.

The online marketplace is available to Canon’s nearly 400 dealers across the United States, and there’s no fee or additional software required.

Canon says other features of the new platform include:

Centralized management. Dealers can centrally manage their customers’ subscriptions, which can include tracking subscriptions sold, adding and renewing subscriptions, billing information, subscription expiration dates and notifications, and the ability to activate, deactivate, and transfer device licenses.

Flexible services. Licenses and maintenance and support can be sold and added to an account on a monthly basis or on a device basis.

Faster billing. Dealers can provide their customers simpler online ordering and invoicing that includes automated calculating of billing for licenses, monthly add-ons, and maintenance and support.

APRIL 2017





A 2017 GUIDE TO B2B E-MARKETPLACES

APPARELBambooRose.com

Fibre2Fashion.com

JoorAccess.com

NuOrder.com

Ordre.com

Poshmark.com

RetailUniverse.com

BUSINESS SOFTWARE AND SERVICES99Designs.com

Appexchange.salesforce.com

BlurGroup.com

ContractorsCustomers.com

DiscoverCloud.com

MojoMarketplace.com

Renescrow.com

VentureApp.com

CONSUMER PRODUCTS INCLUDING EXCESS MERCHANDISEDHGate.com

GencoMarketplace.com

Groupon Goods Liquidation Auctions (GrouponGoods.bstocksolutions.com)

Shotang.com

ViaTrading.com

WeMarket.com

CRAFTS AND PRODUCTS FROM INDEPENDENT ARTISANSAmericanMadeShow.com

GoCoop.com

SouvNear.com

wholesale.TheGrommet.com

GENERAL BUSINESS, INDUSTRIAL, SCIENTIFIC PRODUCTSAmazon Business

(Amazon.com/business)

Alibaba.com

AllActionTrade.com

BizBilla.com

Bizzy.co.id (Indonesia)

Bulkhouse.in

Cogobuy.com

eBay Business Supply (ebay.com/rpp/ ebay-business-supply)

EC21.com

FedBid.com (government and commercial)

GSAAdvantage.com (government and commercial)

IndiaMart.com

KatunMarketplace.com

Kinnek.com

LabNetwork.com

MarketplaceB2B.com

Miriads.info

NeweggBusiness.com

PanAsiaExchange.net

rx.Trxade.com

SAP Ariba (Ariba.com)

SurplusRecord.com

ThomasNet.com

Toboc.com

Touch4Biz.com

TradeBoss.com

Tradebanq.com

Tradeindia.com

Tradekey.com

Tradescraper.com

TradeZone.com

WayfairSupply.com

MOTOR VEHICLES/HEAVY EQUIPMENTAutoWurld.com

MotorTrade.arval.com

RevolutionParts.com

TradeMachines.com

SPECIALTYBid.Aero

HarbourYard.com

IngredientsOnline.com

Yieldorganic.com

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