Guide

High Pay-Off E-Commerce Basics for B2B Manufacturers

How to Master Greenfield and Expansion Projects with Spryker
Content

Manufacturing Industry Outlook in 2023

The pandemic significantly impacted the production capacity of manufacturers around the world. Increased consumer demand meant that manufacturers had to double their production efforts and sail through the hurdles preventing their products from getting to the end user. At the time, some of those obstacles plaguing the industry were complex supply chain issues and workforce shortage. Even as the severity of the pandemic began to dwindle, those challenges remained persistent.

Labor shortages were caused by the demand for higher wages. As employees began to see the need for higher pay in a labor-intensive industry, more of them joined the great resignation, leaving manufacturing plants with less staff and production complexities. Add rising inflation and looming recessions to the mix, and its no surprise that 78% of CEOs and Chief Marketing Officers are worried about the impact of supply chain issues or disruption (supply chain issues or disruption, product failure or quality issues). To increase agility and mitigate risks in this current climate, businesses will have to find tangible solutions to enduring manufacturing issues.

Many manufacturers across the globe are being met with the realization that the answer to successfully navigate these setbacks can be found in digital transformation. Prior to the pandemic, the manufacturing industry as a whole had been known to be resistant to this change. In a sector that relied heavily on man power and manual processes, the concept of digitization was never a topic of discussion but as B2B and B2C consumers continue to demand for a greater and quicker output, businesses within the field must gradually adjust to their new reality.

According to research, the digital manufacturing industry is projected to reach USD 1,370 billion by 2030. This indicates that the adoption of digital technology in manufacturing will very rapidly become the norm and the businesses that are yet to adopt these technologies will lag behind. For forward-thinking organizations, the use of customizable e-commerce platforms and IOT devices will be at the forefront of their transformation. 

In several countries, the manufacturing industry saw a decline in production value since the start of 2020. Although the global manufacturing production value is expected to hit 44.5 Trillion by the end of 2022, experts say that number might plummet in 2023. To improve efficiency and facilitate growth within the sector, stakeholders must begin to identify new areas of opportunity.

Annual production value of the manufacturing sector in Germany from 2011 to 2020

Opportunity Areas for B2B Manufacturers

By leveraging the power of technology, the manufacturing industry can address some of the problems hindering their growth. One key aspect of technology to tap into will be E-commerce. It is no surprise that e-commerce sales continue to rise globally. The Covid-19 pandemic accelerated the growth of digital commerce across various industries and verticals; brands that leaned into online sales generated high revenues. In 2021, e-commerce retail sales amounted to 4.9 billion US Dollars. That number is expected to increase to about 7.3 billion US Dollars by 2025. 

As consumers prioritize convenience, businesses can expect to see more growth within the e-commerce market.

Retail e-commerce sales worldwide from 2014 to 2025

E-Commerce as a percentage of retail sales continues to grow across regions

Source: Euromonitor, Nation Data Sources, Morgan Stanley Research estimates

There are countless benefits a manufacturer might reap from investing in an e-commerce platform. When done right, setting up an e-commerce platform could help a business scale:

  • Customer Closeness & Real-time Insights: With a B2B e-commerce store or even a D2C store, manufacturers have the opportunity to deepen their relationship with consumers. Consumer closeness gives manufacturers insight into consumer needs and buying patterns; with this knowledge, they can modify or fine-tune products to better suit the consumer. Furthermore, manufacturers can create marketing campaigns and track its effectiveness in driving sales. Customer feedback is fundamental for the growth of any business.
  • Larger Distributor Network A B2B e-commerce store will be effective in giving manufacturers access to a wider pool of distributors. Greater access will help solve supply chain roadblocks that manufacturers often face. Expanding to new or untapped markets is also relatively easier with a digital network of distributors or dealers.
  • Efficiency in Inventory and Order Management: One major challenge in the manufacturing industry is inventory management. With an efficient inventory or account management system, B2B manufacturers can aggregate all inventory-related data. Customers are able to order products online at their convenience and manufacturers can better track inventory and manage shipping in a timely manner.
  • Product Recommendations, Search & Personalization: In the world of B2B manufacturing, buyers are usually in search of niche or complex products that are sometimes difficult to source. The right e-commerce solution will help manufacturers tailor their products to consumers through the platform’s search and personalization capabilities.
  • Agility and fast-tracked Innovation: To increase production capacity, B2B manufacturers must move speedily. An e-commerce platform opens the door to innovative solutions such as the use of IOT devices to hasten operational processes. Additionally, it guarantees a faster time to market for the manufacturer’s products.
  • Brand Awareness & Sales Channel: A digital commerce platform is a sales channel that significantly improves brand awareness. Pages with products are easily discoverable on search engine platforms and this can increase visibility for the manufacturer’s products.
  • Customer Service: Better customer experiences can be achieved through a fully functional e-commerce platform. Manufacturers can provide support for their customers in the form of helpful guides on how to utilize their products. This is especially useful in D2C scenarios.

Greenfield Development with Spryker

Pivoting from the use of traditional channels to even the most basic B2B online shop can be a daunting process for manufacturers. Embracing digital transformation is a journey of continuous improvement, so to stay on top of the technological trends that help deliver true business value, stakeholders must prioritize innovative digital commerce solutions.

Spryker offers state-of-the-art e-commerce solutions for businesses looking to build their platform from the ground up. With expert step-by-step guidance, manufacturers can expect to have a new and reliable channel for driving sales. 

Starting with the Basics: 3-Step Process for Manufacturers

Step 1 - Figure out what model and solution works for you: Figuring out the model that works best for your business is the first step in ensuring digital commerce success. Spryker can support the development of an enterprise marketplace, a B2B and D2C commerce platform. Ultimately, whatever platform you select will be dependent on your chosen business model and objectives. 

Manufacturers looking to build a network of distributors could utilize Spryker’s headless B2B solution. For manufacturers that are interested in selling directly to the consumer as a way to increase their profit margin by cutting out the middleman, the D2C solution will be the most viable option. With the >Enterprise marketplace solution, the manufacturer has an opportunity to scale by opening up their commerce platform to other manufacturers selling related or complementary products. Irrespective of the businesses’ needs, Spryker’s headless, modular, and composable solutions are designed to simplify operations and provide an easy to use platform for customers. With Spryker, Best-of-breed third-party software can easily be integrated into the manufacturer’s e-commerce platform to ensure that all additional functionalities needed can be accommodated. Spryker’s GLUE API enables connection to multiple touchpoints.  With a smart device connected to the Spryker Cloud Commerce OS through the GLUE API, a warehouse operations manager can easily handle the approval of goods waiting to be distributed to the customer. On the customer side, headless commerce makes it possible for checkouts to be carried out through any touchpoint.

Step 2 – Explore capabilities and features of the chosen solution: Spryker’s solution comes with several capabilities and features that can help manufacturers operate more efficiently. For one, the workflow and process management feature of the B2B commerce solution enables stakeholders to manage the approval of orders as well as quotation and offers. The quotation and offer management feature takes care of the negotiation process that typically takes place between the sales representative on the manufacturer’s side and the B2B customer. There is also a company account feature that allows the platform owners to assign company user roles and permissions in the back end. A few other capabilities include product management, order management and tax management. These Packaged Business Capabilities offered by Spryker contain a unique combination of features that the manufacturer needs to build a fully functional e-commerce shop. 

Step 3 – Minimum Viable Product: Manufacturers working with Spryker are able to build a minimum viable product (MVP) in a timely manner. The minimum viable product approach will give the manufacturer room to get the first version of their shop up and running, collect feedback and then make improvements where necessary. These days, agility is required for true digital commerce success. The modular nature of the Spryker Cloud Commerce OS makes it possible to move speedily and adapt to the ever changing world of online sales. Being able to iterate based on user-feedback is critical for future expansion. 

Spryker Customers in the Manufacturing Sector

STAUFF

Frictionless B2B Commerce

STAUFF redefined and rebuilt their entire digital B2B commerce experience with Spryker to address a common pain point in the market: offering seamless access to purchasing needed spare parts to existing and new customers without unnecessary friction. STAUFF customers can easily search for products they need, set-up complex access management to fulfill internal procurement requirements, import spare parts lists for ordering, place recurring orders, and much more.

STAUFF’s commerce experience is based on Spryker’s B2B suite giving them access to a wide range of functionalities to digitize their commerce experience: multi-language support, advanced account management, integrations into existing ERP & CRM platforms, product information management, and more. STAUFF uses this foundation and is able to build on top of it to create a buying journey that matches their individual demands and surpasses their customers’ expectations.

Read Stauff’s entire success story here:

Read their story

Jungheinrich

A holistic e-commerce platform

Jungheinrich wanted to expand its e-commerce capabilities to better serve the needs of the company’s end customers. To achieve this, it needed a holistic e-commerce platform where all of the company’s digital commerce activities could be consolidated.

Jungheinrich has succeeded in creating digital access to over 800,000 spare parts for its B2B end customers in 40 countries with the Spryker Commerce OS B2B Suite and Solution Partner Dept Agency. In August 2020, the first storefronts of the new online parts store were launched on Spryker and the solution was rolled out to a total of 40 countries, plus one international online store, in just a few months. All stores are under the responsibility of the countries themselves and tailored to local requirements. A dynamic, modern and globally-oriented commerce solution was built that offers a compelling customer journey and can easily be adapted to future needs. 

Read Jungheinrich’s entire success story here

Read their story

Conclusion

For manufacturers, especially in the B2B environment, digital commerce means more than simply providing an online store. It also stands for the development of a clear business model and the reorganization of traditional sales channels. Digital commerce in manufacturing is also a way to reduce the distance between B2B and B2C by offering a choice of products directly to the consumer (D2C).

About Spryker

Spryker is the leading global composable commerce platform for enterprises with sophisticated business models to enable growth, innovation, and differentiation. Designed specifically for sophisticated transactional businesses, Spryker’s easy-to-use, headless, API-first model offers a best-of-breed approach that provides businesses the flexibility to adapt, scale, and quickly go to market while facilitating faster time-to-value throughout their digital transformation journey. As a global platform leader for B2B and B2C Enterprise Marketplaces, IoT Commerce, and Unified Commerce, Spryker has empowered 150+ global enterprise customers worldwide and is trusted by brands such as ALDI, Siemens, ZF Friedrichshafen, and Ricoh. Spryker is a privately held technology company headquartered in Berlin and New York backed by world class investors such as TCV, One Peak, Project A, Cherry Ventures, and Maverick Capital. Learn more at spryker.com.

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