How does a BtoB marketplace work?

Basically put, a BtoB marketplace works like a marketplace for private individuals – by bringing together vendors and buyers on a distributor’s website. Yet there are a few (major) differences. Here are a few explanations.

Generally speaking, a BtoB marketplace is similar to a BtoC marketplace:

• BtoB vendors have access to a section dedicated to independent vendors on a distributor’s website (such as Amazon or Cdiscount).
• They can create a free professional account, then upload their product catalogues.
• Buyers browse through the platform to select their products and a vendor, according to several criteria (price, vendor popularity, delivery speed and fees, etc.).
• Vendors generally manage their stock themselves and handle their own dispatching once orders have been placed. The transaction is done in their own name. For instance, it is shop Y selling on Amazon Business instead of Amazon itself.
• The packaging and dispatch labels are printed with the distributor’s name on them. The buyer receives the product as if it had come from the platform on which they placed the order.
• BtoB vendors are free to set their own prices. In any case, they pay commission to the distributor for each sale, calculated according to a percentage of the total order amount.
• Orders are scored and commented on by buyers. BtoB vendors therefore have a profile with customer feedback and boast an overall performance score.
• Buyers can directly contact vendors offering cancellation, return or reimbursement services.

However, BtoB marketplaces have specific features adapted to professional needs. Namely:

• More flexible payment terms: request for a quote, dynamic selection, automatic payments, payment in several instalments, payments via a trusted third-party, factoring, etc.
• Many different options for each product (grouped orders in indivisible packs for instance).
• Pricing options: dynamic prices, wholesale prices, inc-tax and ex-tax price differentiating, pricing per consumer segment, etc.
• Confidentiality of sensitive data regarding certain products (to avoid counterfeits or technology theft).
• The possibility for BtoB vendors to choose their buyers according to their market positioning (luxury clothing brands will prefer to work with high-end retailers for instance).

In a nutshell, in BtoB marketplaces, vendors lean against a platform whose operation is the same as that of a marketplace for individuals – except that they get extra advantages.