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Bad Economy/Good Opportunity: Unlocking the Power of the B2B Channel

Greg Tabor
By Greg Tabor, Director Supplier Programs, Ariba
 

In the previous two issues of Supply Lines, we discussed the measuring of results in the B2B channel (“Measuring B2B Channel Success”) and how to maximize the benefits of a faster order-to-cash cycle (“Driving Results in the B2B Channel”).

It’s amazing how quickly things can change—when this series began, the economy was still strong and most businesses were enjoying double-digit growth. Now, we’re seeing sales stall, travel and hiring freeze, and businesses contract. This is concerning to say the least, and companies need to be even more judicious with where they invest. Fortunately, the B2B channel represents one of the few “sales channels” that will actually EXPAND in this economy, relative to a total percent of sales.

Think about it: layoffs, hiring freezes, and spend scrutiny all point to customers managing spend and resources more effectively, and the B2B channel—particularly the Ariba® Supplier Network™—offers one of the most effective ways to do more with less while controlling spend.

Is your company ready? Has management bought into the fact that the B2B channel is a sales channel, not just an IT function? If you’re a CEO, CFO, sales manager, or B2B channel manager, it’s time to champion the B2B channel within your organization. Here are some steps that all suppliers should take to stay competitive and protect what will certainly be a shrinking market share.

  1. Embrace the B2B channel—it’s not a fad! Stop trying to get customers to circumvent the B2B channel to meet a “business as usual” approach. Too often we hear suppliers encouraging customers to “just fax me the order.” This is short-sighted, as it causes your customer to lose order processing cost savings opportunities, which will hurt you in the long term. Moreover, if that sales contact leaves or is reassigned, you may be stuck with someone who understands the value of the B2B channel and wants suppliers who embrace it—which means you could lose the business to a more eBusiness-savvy competitor.

  2. Educate yourself. It’s not enough to simply react to customers’ requests. You should know why they’re using Ariba (or another provider), who is driving the initiative, and how to participate. Understand your options and learn about the provider. Aligning yourself with your customer’s initiative greatly improves your chances of maintaining or increasing the available market share.

  3. Reduce your costs. As pointed out, smart suppliers can speed the order-to-cash cycle and reduce costs. It’s time to understand how to do this in your organization. By looking at the business holistically and viewing B2B as a sales channel, you’ll find opportunities that will quickly reduce costs through automation—and most of these investments will have a quick ROI.

  4. Market your capabilities. More and more buying organizations are aggressively enabling suppliers and seeking new vendors who “get it.” If you’re a willing participant, you can gain business! However, you need to market your willingness and capabilities, and the good news is that many affordable marketing opportunities exist, from user conferences to simple logo placement or involvement in marketing programs. In Ariba’s case, we offer plenty of resources to help you promote your B2B expertise.

  5. Educate your sales team. Sales teams need to understand the opportunity the B2B channel represents; bad information causes bad decisions. It’s hard to believe what we sometimes hear from suppliers about what’s been asked of them, and it all comes from a general lack of knowledge about the channel. Just as fax machines were a mystery 20 years ago and websites were unfamiliar 10 years ago, the B2B channel is often misunderstood today. But it’s the way business will be done in the years to come. Now is the time to become B2B-savvy; those who do will win.

Make no mistake about it—the next year is going to be tough. It’s time to embrace to opportunity that the B2B channel and Ariba offer you as a supplier. To do that, it’s essential that you:

  1. Speed your order-to-cash cycle
  2. Reduce your costs
  3. Increase business opportunities
  4. Support your customers’ initiatives
Ariba and the Ariba Supplier Network can help you accomplish all four.

Find Out More

Customers are looking for suppliers who are WILLING AND ABLE to support their B2B channel initiatives. Ariba offers programs, training, and support to assist you. For example, the Ariba® Ready™ Program is one valuable resource that can help. Check out the benefits it provides by reading “Is Ariba Ready Right for You?”. You can also contact supplierprograms@ariba.com or call 1-866-583 5988 if you have questions or want to learn more.


Give Us Your Feedback
Ariba would like to know your thoughts about this topic and any other ideas you have for future articles. Please send your input to us at supplierprograms@ariba.com.