B2C vs. B2B

B2C, or business-to-consumer e-commerce, is the selling of products or services to individual consumers over the Internet. B2B, or business-to-business e-commerce, is the selling of products or services to other businesses over the Internet. Since both types of business are e-commerce, ostensibly they should operate similarly; however, there is a significant difference in the supply chains of the two types of businesses. The fundamental distinction between the B2B and B2C supply chains is in their handling of fulfillment.

Fulfillment is a bulwark of customer satisfaction in e-commerce, particularly in B2C. A customer who orders a book from Amazon.com tonight expects to receive shipment of it within a few days. He likely neither knows nor cares to know how the book will get to him, but his satisfaction and repeat business are predicated on the convenience of the ordering process and the speed and accuracy of its fulfillment. Toys "R" Us had a fulfillment problem in 1999 that caused some of their Christmas orders to be delivered late, and since then companies have spent billions of dollars improving their logistical systems to ensure on-time delivery (Patton).

Supply chain and logistical technologies have changed so radically, in fact, that they bear little resemblance to those of even the recent past. New ways of fulfilling orders incorporate virtual warehousing, point-to-point on-demand delivery, cross-docking, and other rapid shipment techniques combine

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ingle long-term contract, although they are increasingly available in smaller components to enable businesses to choose the best-in-class provider for each capability (Hintlian & Mann). The types of partnerships that can be formed characterize the type of e-commerce B2B or B2C that they support. Mutual partnerships a hallmark of B2B businesses, support just-in-time (JIT) replenishment through automated reordering via electronic data interchange. E-procurement is primarily B2B and involves the supply of products from multiple supplier locations to a single customer location. Agents and distributors are characteristic of both B2B and B2C and can be either stocked or stockless. The stocked fulfillment model assembles orders from stock on hand via automated picking, while the stockless fulfillment model ships orders directly from the manufacturer to the customer. Direct channel fulfillment is used by both B2B and B2C and involves allowing customers to place and track their orders with a supplier. Exchanges and auctions are primarily B2B and require real-time confirmation of fulfillment availability and delivery pricing. Digital transaction hubs are also B2B and focus on reducing the integration costs between buyers and seller

Category: Business - B