B2B Marketplaces: Definition and the Top Marketplaces to Use
What is a B2B marketplace?
To understand B2B, you first need to understand B2C. You’ve probably heard of Amazon — one of the world’s largest online marketplaces. Amazon’s platform is an example of a business-to-client (B2C) marketplace. Businesses sell their products directly to clients through Amazon’s platform. Conversely, B2B marketplaces sell their products directly to other businesses.
While not all businesses can utilize B2B online marketplaces, if your company sells a product, there’s a chance that you could earn more profits by using a B2B marketplace. So, why should you?
Benefits of B2B marketplaces
There are countless benefits of selling your products online through B2B marketplaces. Here are just a few of the reasons why you should consider selling on B2B online marketplaces:
- Globalization: B2B online marketplaces allow products to be sold overseas that before may otherwise have never even reached neighboring countries. They enable businesses to get products or parts that may have formerly only been available in one country or region. With these international B2B marketplaces, we can advance technology, production, and more by combining products made by experts all over the world.
- Bulk products: As a seller, B2B online marketplaces allow you to sell products in bulk, resulting in a much larger profit. Rather than in a traditional B2C marketplace where your business might sell a few products per day, B2B marketplaces can get you selling thousands of products per day through bulk orders.
- Pricing per customer: In B2B online marketplaces, pricing fluctuates, and your prices can change based on the customer (other business) that is buying your products. This means that most of the time, you can earn more of a profit from a B2B marketplace than when selling directly to clients.
- Low costs: In addition to the high profit margins that B2B online marketplaces allow, these platforms are also typically lower cost than B2C marketplaces such as Amazon. Businesses that are new to the marketplace usually have especially low seller costs within B2B to give them room to grow. Not to mention — B2B marketplaces get you new clients who buy in bulk, saving your business overhead and production costs.
Drawbacks to B2B online marketplaces
Of course, nothing about the ecommerce world is perfect. Here are a few of the drawbacks you could encounter when using B2B online marketplaces:
- Globalization: Yes, Globalization can also be a drawback when it comes to B2B online marketplaces. While it’s great that international products are available, you could come across a number of issues.
- Payment type not being accepted: Some B2B marketplaces may only accept their local currency, which means you could find the perfect buyer, but they only offer yen and you only accept dollars.
- Long wait time for products: There is a long list of reasons why your B2B marketplace products might be delayed in shipping, whether it’s an employee shortage, material shortage, shipping costs, political event, international holiday, natural disaster, or a myriad of other problems. These can all contribute to long wait times, and ultimately, the loss of your B2B marketplace sale.
- Overselling: By having your products listed in multiple places, you run the risk of getting many bulk orders that your inventory and production can’t keep up with.
5 best B2B marketplaces
While there are many B2B marketplaces to choose from, not all are created equal. These are the best B2B marketplaces and why they deserve that title:
- Amazon Business: In terms of market cap, Amazon is the world’s largest online retailer. The ecommerce giant has had major success and certainly knows how business is done. Amazon has a separate B2B marketplace portal called Amazon Business dedicated for professional sellers to gain business clients.
- Alibaba: Alibaba is another top B2B marketplace to check out. Amazon is to America what Alibaba is to China. As the largest retailer in the country with the largest population, this site serves millions of people all over the world.
- IndiaMart: With a similar business model to Alibaba, IndiaMart is another top B2B marketplace to consider. As India’s largest B2B marketplace, the ecommerce site boasts 119 million buyers and 6.4 million suppliers.
- DHGate: This Chinese B2B online marketplace has grown in popularity in the United States over the past few years. The company considers itself “the world’s leading B2B online trading marketplace for goods manufactured in China” (although Alibaba may disagree).
- ThomasNet: While not an ecommerce platform, ThomasNet is a top B2B online marketplace directory that B2B suppliers pay to be included in. While pricing can be high, this is another top B2B marketplace to consider.
Join the best B2B marketplaces and capture more sales
WebFX’s team of experts can connect you with top B2B marketplaces and help your business market and sell its products using the best B2B marketplaces in the world. Ready to globalize your business and start increasing your revenue? Contact us today for a free quote.