Igor Nikolenko, Co-Founder and CEO of SupplyMe, a new online B2B marketplace that connects local food suppliers with restaurants, hotels, cafés, supermarkets and other foodservice businesses of all sizes, shares the benefits of driving digital transformation for the F&B sector.
Organisations across the globe in various industries were already in the throes of digital transformation pre-pandemic, but Covid-19 accelerated the pace of transformation and pushed digital commerce front and centre for both B2B and B2C buyers, leaving businesses to embrace the e-commerce model like never before. It has been found that 56% of B2B customers shopped online for products they had never bought online before.
Co-Founder and CEO, SupplyMe
B2B e-commerce is challenging the authority of traditional sales channels. Market estimates indicate that the industry is forecasted to reach $1.8 trillion by 2023, accounting for 17% of all B2B sales in the US, with a compound annual growth rate (CAGR) of 10%.
An activity which has been all about a meaningful personal interface for decades, such as procurement of food and beverage products by restaurants, hotels, cafés, caterers, supermarkets, and other foodservice businesses, suddenly jumped on procuring products online for the first time – as a survival tactic.
Estimates from Frost & Sullivan shared in 2020 forecast the B2B e-commerce market to hit more than $6.6 trillion worth of sales — significantly more than the estimated $3.2 trillion generated in the business-to-consumer market.
The shift in consumption and purchasing patterns witnessed in 2020 has led the B2B food industry to embark on its journey to embrace innovation, going paperless, and be more efficient. For business to survive and stay competitive in the ‘new normal’ and economic environment, it will require new strategies and practices. It’s imperative for businesses to consider competencies such as enterprise agility, cost management, workforce resiliency, innovation, or cashflow management as crucial factors for their business success.
Customers of B2B industries have given a direct customer ultimatum to provide shopping experiences which are as seamless and convenient as B2C. One of the reasons for this shift in shopping preferences is due to the millennial generation taking over executive-level realms in companies. This generation served a wake-up call to all B2B businesses to get their customer experience management strategy in order, amplifying the importance of customer experience and demands for better digital experiences.
The most important aspects they are looking for are speed, flexibility and transparency. Customer-centric strategies once reserved only for B2C consumers are now fundamentally changing the complicated landscape of B2B relationships, too.
The preference of receiving personalised online experiences created new dynamics in an evolving market. About 42% of millennials use real-time messaging and social media while at work. This means that, as B2B buyers, they favour omnichannel communication methods for quick and instantly gratifying information, giving them everything they need in the most streamlined manner possible.
Industry estimates suggest that online marketplaces will account for more than 50% of global online transactions; the reason be that they offer suppliers and customers a variety of benefits which are not available in the traditional business model, such as the ability to interact and engage with customers in real-time for suppliers and the choice to select from an assortment of products and services at an extremely competitive price, delivered in a timely manner.
The need for speed and efficiency
In a recent McKinsey survey of 1,000 B2B decision-makers, lack of speed in interactions with their suppliers emerged as the number-one ‘pain point’, mentioned twice as often as price. Many B2B companies often take days to provide a quote, require customers to fill in complicated order forms (often on paper), and frequently leave customers in the dark about the status of their order.
The digitalisation of this process through online marketplaces helps customers get instant information through digital catalogues available on the platform, with competitive pricing. It allows for instant order confirmation and provides real-time updates on delivery of the products, thus enhancing customer experience.
Reordering familiar products and services
Efficient and error-free reordering is a major concern for customers sourcing raw materials in the F&B space. The McKinsey survey also stated that digital solutions loom large in executives’ thinking as a way to make routine tasks more efficient. Around 86% of respondents said they prefer using self-service tools for reordering, rather than talking to a sales representative.
The machine-learning feature in online marketplaces can help automate this task for the F&B industry, making reordering a simple and easy-to-do task, with a huge impact on positive customer satisfaction.
Smart invoicing
Providing the convenience and top-notch experience that B2B buyers are looking for requires flipping the traditional way of thinking and doing business. Every step of the buying journey must be considered, from how customers research their products and evaluate options, to what tailored help and content they will need along the way, and finally to support post-purchase.
The manual process of invoicing is quite cumbersome and not suitable for businesses generating a high volume of invoices every day in the F&B industry. This challenge can be easily overcome when the purchases are made through an online platform that provides an e-invoice, which is identical to the traditional paper invoice and contains all of the key information such as customer invoice number, shipping or service address, goods sold, price, quantity, PO details, payment information, dates of the transaction, and supplier information.
Going digital in this aspect can make document retrieval and management simple, easy and accessible at any time through their preferred device, channel or the timing. This is definitely a key competitive advantage.
