THE BASIC TYPES OF B2B TRANSACTIONS AND ACTIVITIES
- Sell-side
- Buy-side
- Exchanges
- Supply chain improvements and collaborative
commerce
THE BASIC TYPES OF B2B E-MARKETPLACES AND SERVICES
One-to-Many and Many-to-One:
Private E-Marketplaces Company-centric EC
E-commerce that focuses on a single company’s buying needs (many-to-one, or buy-side) or selling needs (one-to-many, or sell-side).
Private e-marketplaces Markets in which the individual sell-side or buy-side company has complete control over participation in the selling or buying transaction.
B2B CHARACTERISTICS
Parties to the Transaction:
Sellers, Buyers, and Intermediaries online intermediary
An online third party that brokers a transaction online between a buyer and a seller; may be virtual or click-and-mortar.
Types of Transactions lspot buying The purchase of goods and services as they are needed, usually at prevailing market prices.
Strategic (systematic) sourcing
Purchases involving long-term contracts that usually are based on private negotiations between sellers and buyers.
Types of Materials Traded Direct materials
Materials used in the production of a product (e.g., steel in a car or paper in a book).
Indirect materials
Materials used to support production (e.g., office supplies or light bulbs).
MRO (maintenance, repair, and operation)
Indirect materials used in activities that support production.
Direction of Trade vertical marketplaces
Markets that deal with one industry or industry segment (e.g., steel, chemicals). horizontal marketplaces Markets that concentrate on a service, material, or a product that is used in all types of industries (e.g., office supplies, PCs).
SUPPLY CHAIN RELATIONSHIPS IN B2B VIRTUAL SERVICE INDUSTRIES IN B2B THE BENEFITS OF B2B SELL-SIDE MODELS AND ACTIVITIES sell-side e-marketplace A Web-based marketplace in which one company sells to many business buyers from e-catalogs or auctions, frequently over an extranet. B2B Sellers Customer Service
DIRECT SALES FROM CATALOGS
Configuration and Customization Benefits and Limitations of Direct Sales from Catalogs DIRECT SALES: THE EXAMPLE OF CISCO SYSTEMS
Manufacturers frequently use intermediaries to distribute their products to a large number of buyers. The intermediaries (known as distributors) usually buy products from many vendors and aggregate them into one catalog from which they sell.
USING AUCTIONS ON THE SELL SIDE
Revenue generation
Cost savings lIncreased “stickiness” lMember acquisition and retention
- Sell-side
- Buy-side
- Exchanges
- Supply chain improvements and collaborative
commerce
THE BASIC TYPES OF B2B E-MARKETPLACES AND SERVICES
One-to-Many and Many-to-One:
Private E-Marketplaces Company-centric EC
E-commerce that focuses on a single company’s buying needs (many-to-one, or buy-side) or selling needs (one-to-many, or sell-side).
Private e-marketplaces Markets in which the individual sell-side or buy-side company has complete control over participation in the selling or buying transaction.
B2B CHARACTERISTICS
Parties to the Transaction:
Sellers, Buyers, and Intermediaries online intermediary
An online third party that brokers a transaction online between a buyer and a seller; may be virtual or click-and-mortar.
Types of Transactions lspot buying The purchase of goods and services as they are needed, usually at prevailing market prices.
Strategic (systematic) sourcing
Purchases involving long-term contracts that usually are based on private negotiations between sellers and buyers.
Types of Materials Traded Direct materials
Materials used in the production of a product (e.g., steel in a car or paper in a book).
Indirect materials
Materials used to support production (e.g., office supplies or light bulbs).
MRO (maintenance, repair, and operation)
Indirect materials used in activities that support production.
Direction of Trade vertical marketplaces
Markets that deal with one industry or industry segment (e.g., steel, chemicals). horizontal marketplaces Markets that concentrate on a service, material, or a product that is used in all types of industries (e.g., office supplies, PCs).
SUPPLY CHAIN RELATIONSHIPS IN B2B VIRTUAL SERVICE INDUSTRIES IN B2B THE BENEFITS OF B2B SELL-SIDE MODELS AND ACTIVITIES sell-side e-marketplace A Web-based marketplace in which one company sells to many business buyers from e-catalogs or auctions, frequently over an extranet. B2B Sellers Customer Service
DIRECT SALES FROM CATALOGS
Configuration and Customization Benefits and Limitations of Direct Sales from Catalogs DIRECT SALES: THE EXAMPLE OF CISCO SYSTEMS
Manufacturers frequently use intermediaries to distribute their products to a large number of buyers. The intermediaries (known as distributors) usually buy products from many vendors and aggregate them into one catalog from which they sell.
USING AUCTIONS ON THE SELL SIDE
Revenue generation
Cost savings lIncreased “stickiness” lMember acquisition and retention
AUCTIONING FROM THE COMPANY’S OWN SITE
USING INTERMEDIARIES IN AUCTIONS
EXAMPLES OF B2B FORWARD AUCTION
Buy-side e-marketplace A corporate-based acquisition site that uses reverse auctions, negotiations, group purchasing, or any other e-procurement method.
PROCUREMENT METHODS
e-sourcing
e-tendering
e-reverse auctioning
e-informing
Web-based ERP (electronic resource planning) le-MRO (maintenance, repair, and operating)
INEFFICIENCIES IN TRADITIONAL PROCUREMENT MANAGEMENT
Procurement management
The planning, organizing, and coordinating of all the activities relating to purchasing goods and services needed to accomplish the organization’s mission. lmaverick buying Unplanned purchases of items needed quickly, often at higher prices, not pre-negotiated.
THE GOALS AND BENEFITS OF E-PROCUREMENT
E-procurement :
The electronic acquisition of goods and services for organizations.
Request for quote (RFQ)
The “invitation” to participate in a tendering (bidding) system.
CONDUCTING REVERSE AUCTIONS
E-Tendering by Governments
GROUP REVERSE AUCTIONS
BUYING AT E-AUCTIONS
Group purchasing :
The aggregation of orders from several buyers into volume purchases so that better prices can be negotiated.
Internal Aggregation
External Aggregation
BUYING FROM E-DISTRIBUTORS PURCHASING DIRECT GOOD SEL EC TRONIC BARTERING
bartering exchange An intermediary that links parties in a barter; a company submits its surplus to the exchange and receives points of credit, which can be used to buy the items that the company needs from other exchange participants.
Dynamic pricing:
A rapid movement of prices over time and possibly across customers, as a result of supply and demand matching.
FUNCTIONS OF EXCHANGES
Matching buyers and sellers lFacilitating transactions lMaintaining exchange policies and infrastructure
USING INTERMEDIARIES IN AUCTIONS
EXAMPLES OF B2B FORWARD AUCTION
Buy-side e-marketplace A corporate-based acquisition site that uses reverse auctions, negotiations, group purchasing, or any other e-procurement method.
PROCUREMENT METHODS
e-sourcing
e-tendering
e-reverse auctioning
e-informing
Web-based ERP (electronic resource planning) le-MRO (maintenance, repair, and operating)
INEFFICIENCIES IN TRADITIONAL PROCUREMENT MANAGEMENT
Procurement management
The planning, organizing, and coordinating of all the activities relating to purchasing goods and services needed to accomplish the organization’s mission. lmaverick buying Unplanned purchases of items needed quickly, often at higher prices, not pre-negotiated.
THE GOALS AND BENEFITS OF E-PROCUREMENT
E-procurement :
The electronic acquisition of goods and services for organizations.
Request for quote (RFQ)
The “invitation” to participate in a tendering (bidding) system.
CONDUCTING REVERSE AUCTIONS
E-Tendering by Governments
GROUP REVERSE AUCTIONS
BUYING AT E-AUCTIONS
Group purchasing :
The aggregation of orders from several buyers into volume purchases so that better prices can be negotiated.
Internal Aggregation
External Aggregation
BUYING FROM E-DISTRIBUTORS PURCHASING DIRECT GOOD SEL EC TRONIC BARTERING
bartering exchange An intermediary that links parties in a barter; a company submits its surplus to the exchange and receives points of credit, which can be used to buy the items that the company needs from other exchange participants.
Dynamic pricing:
A rapid movement of prices over time and possibly across customers, as a result of supply and demand matching.
FUNCTIONS OF EXCHANGES
Matching buyers and sellers lFacilitating transactions lMaintaining exchange policies and infrastructure