Doing Business Online — Private B2B Exchanges
by:
Nowshade Kabir
Business processes are the building blocks of an enterprise. If one of these processes fails to live up to its expectation, business starts to flounder. How to minimize the risks, get a better observance of the processes and, at the same time, reduce price involved? The answer is – business process automation.
Although, automatic business processes based on online technologies can create dumbfounding value to existing business, many a companies are slow to adopt technological innovations and reap benefits from them. However, lately, things have started to change! According to a recent poll conducted among mid size companies shows 52 pct of respondents plan to spend over a million dollar on business process automation. Large companies – early adopters of online business processes – have been vastly
profiting from the value created by process automation. Intel recently declared
that it saved one billion dollar last year alone thanks to online business process management.
In broader sense, business process management technology delivers solutions to understand, analyze and simulate business process models. Companies adopt this technology to contour
their business operations, lower overhead expenses, reduce maverick buying, reduce paper-based – mistake prone – transactions and get better control. The ultimate goal is to do the corporation a fully process-managed enterprise, changed
through strategy, design, realization and actual operations.
Companies require streamlining their business processes to help solve various crucial but specific problems, such as:
An electronic supplier, in order to stay competitive, requires reducing order fulfillment cost aggressively.
A bourgeois necessarily to reduce shipping time by better observance his incoming shipping.
A manufacturer necessarily to cut creation cost by reducing manufacturing time of a key product.
A bank necessarily to develop and market a business product faster
than its competitors.
A large distributor necessarily to consolidate buyers and suppliers to bring efficiency to its business.
Although, business processes are wide in range; and there are many a complex issues that require meticulous work, automation of several basic processes may bring notable result for virtually any company. These processes include supply chain, procurement, logistics, inventory control, etc. By adopting an online business to business exchange companies can contour
most of these business processes conveyance additional value to their operations.
A B2B exchange is a unified online platform, wherever
buyers and sellers login to communicate, collaborate and do business transactions. A private B2B exchange, mostly, consolidates suppliers and buyers of a specific company, which owns and operates the exchange.
There are two route of desegregation B2B exchange to alter business processes. A institution can participate in existing B2B exchange or create its own private exchange.
While for small companies, it is much viable to participate in a major B2B exchange that has required components, larger companies should consider creating their own B2B exchange.
The profits companies can reap from change of integrity an existing B2B exchange or creating their own private one could be enormous.
Customer Base Development
A supplier, once registers with a B2B exchange, gets immediate access to a large community of prospective buyers of his products or services.
Increase Revenue from Existing Customers
Business process automation allows companies develop products faster, buyers get faster
and easier access to product information, obtain faster
response to their requests, get better consumer
keep and may buy products online. These turn into much sales.
Add Profit from Value Additional Services
Once the exchange is set as primary sales channel, accessible free resources can be used to create much value additional services for clients. Several of the services that the exchange may offer as well can be used to generate much value.
Reduce Order Process
Cost
The supply chain solutions of a B2B exchange may allow sellers to reduce order process
cost significantly. Studies show that cost of process
a purchase order can be reduced from US$ 70 down to US$ 6 only.
Sales and keep price
By automating sales and consumer
keep processes companies can reduce over head price over 25-30% easily.
Inventory keeping price
Clearer visibility and foretelling ability allow companies substantially
reduce inventory keeping costs.
Since an existing B2B exchange may not have all the necessary features and functions, a nice option is to build a private exchange based on one’s own specific business process automation need. This exchange, at its minimum, should be able to cover major portion of supply chain and inventory control.
The following elements should be integrated to create substantial value to a private B2B exchange:
Supply Chain Management
Supply chain management is the core resolution of an exchange and can deliver great values to existing systems. Implementation of this resolution wish help attain implausibly high return on investment. Business process automation in this component of the exchange includes several bourgeois and buyer–side quotation, requisition, purchase order and invoice.
Marketplace
This is the venue wherever
the exchange owner institution wish post their products for sale. A purchasing
cart should be integrated to the electronic marketplace in order to alter the purchase
process. The offered-for-sale products wish be directly related to inventory control management component of the exchange.
Auction
Electronic auction system can use several English and Dutch auction methods. For convenience the auction component can be integrated to the electronic marketplace. Online auction helps liquidate surplus goods easily.
Reverse Auction
This resolution allows alter electronic procurement, wherever
suppliers contend
for a business deal real time online.
Members Storefront
The participants of the Private Exchange – several buyers and sellers of the exchange owner institution get a Storefront that reflects profile of the company, their products and different information.
Forum
A Forum or Discussion Board is an organized, on-line interactive message board wherever
participants conduct discussion on a set of topics by posting questions, comments and responses.
Directory of Companies
This is a listing of all registered participants – buyers and sellers of the exchange owner institution – either by business category or by alphabetical order. An advanced search engine tool can be incorporated in order to find a institution based on data provided.
E–catalog
E–catalog is a hierarchy of product and service categories. All products and services handled by the exchange owner institution should be consolidated in the catalog.
Private B2B exchange is a powerful concept, which engulfs a fairly big portion of business processes requiring automation. This is much like a business scheme
that has an ability to change the way companies think and do business and create tremendous value to their owners.
Nowshade Kabir is the founder, primary developer and present CEO of Rusbiz.com. A Ph. D. in Information Technology, he has wide experience in Business Consulting, International Trade and Web Marketing. Rusbiz is a Worldwide B2B Emarketplace with solutions to start and run online business. You can contact him at mailto:nowshade@rusbiz.com,
http://ezine.rusbiz.com , http://www.rusbiz.com ,
http://ezine.rusbiz.com/newsletters/newsletter31.htm
