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B2B Logistics: Meaning, Challenges, & Solutions

sahil bajaj

Sahil Bajaj

Senior Specialist - Marketing @ Shiprocket

April 10, 2024

8 min read

Many eCommerce businesses underrate the retail presence as they are very enthusiastic about breaking even space within the market. However, for wholesalers and B2B distributors, it acts as an advantage. With more and more businesses entering the B2B market, new challenges and complexities are arising. Staying ahead of the curve can challenge B2B distributors who will be required to tackle pure-play retailers and specialists. They must also meet ever-evolving and demanding consumer expectations while adapting to the latest technologies. The entire lifecycle of managing the transportation of goods must ensure that they are delivered to customers on time and cost-effectively.

Throughout this blog, we’ll explore some of the major challenges that B2B distributors face. This blog will also provide some of the best strategies you can practice to avoid those hurdles.

Supercharge Your Business with B2B Logistics Mastery

Understanding the Significance of B2B Logistics

B2B logistics involves the large-scale transportation of materials and products from one business to another. It is vital to a company’s success as it involves numerous variables that can hinder the supply chain process. Business-to-business distribution involves delivering and selling products and materials to another business post several stages, including procurement, finding a consumer, deciding on transportation mode, scheduling, delivery time, costing, packing, storage, etc.

B2B logistics play a vital role in understanding these variables, how they interact, and how they all come together. Trying to get all of these variables to work in harmony is key. Meticulous planning is involved throughout the complete B2B process. Furthermore, it also includes understanding potential roadblocks, delays, and issues that can arise down the supply chain process. Ultimately, meeting the customer’s demand on time will be the primary goal to ensure maximum customer satisfaction.

Most organisations depend on B2B services for smooth operations and customer experiences. Either when conventional wholesalers or eCommerce businesses sell their goods through retailers, larger quantities of products will be distributed through B2B sales and distribution focus strategies. Enough inventory must be maintained for such type of shipping. The B2B distributor is solely responsible for shipping and packing the order to the retailer, wholesaler, or manufacturer.

After this process, the consumer can choose what can be done with that product. Generally, the finished goods are sold to the end customers directly.

Hurdles in B2B Logistics Management

With today’s erratically changing markets, customer demands must be met efficiently and easily. However, multiple challenges can arise while supplying to your customers. Logistics partners must navigate all these roadblocks that arrive on their way to complete an order.

Here are some of the most common hurdles that B2B logistics management business face: 

  • Pure-play distributor competitors

The sudden domination of eCommerce players like eBay, Flipkart, Amazon, Alibaba, etc., is one of the major challenges that any B2 B distributor must overcome. B2B distributors will find it extremely challenging to overcome these pure-play partners who have already established their brands globally. Several businesses will undoubtedly turn heads toward such companies for procurement, and with their enormous resources, they can expand their presence in the market on a larger scale. This creates numerous hurdles before a B2B distributor can be established. Gaining visibility and a target audience can be one of their biggest challenges.

  • Hardships in transitioning to an online ecosystem

Adapting new forms of technology can be a daunting task for anyone. B2B distributors also find it extremely challenging to communicate and sell to online customers. They tend to rely on conventional methods of communication like the telephone or email to meet their sales quota and accept orders. But with today’s emerging market, B2b buyers are adopting online platforms to meet their sales, research, reach out to customers, and make purchases. Adapting to the latest trends is vital for them as they are a high risk of:

  • Missing out on their target customers and opportunities to claim different areas of business
  • Recording fewer sales that reduce profits
  • Greater inadequacies, inefficiencies, and errors due to manual working
  • Falling behind in the market due to pure players and other eCommerce businesses
  • Supplier and consumer disintermediation

When a supplier decides to skip a distributor entirely, disintermediation occurs. These sellers sell their products directly to the retailer or wholesaler. This path allows them to increase their profit margins and gain useful consumer data that can help them with procurement and manufacturing. Disintermediation can also occur when the B2B distributor is not efficient. It allows the seller to remove the distributor from the entire supply chain process and work directly with the consumer. Hence, an additional effort must be made by the B2B agent to meet the consumer’s demand. Adopting the latest technology can help them speed up their processes and improve efficiency.

  • Competing against niche specialised companies

Distributors must compete even with smaller companies that are specialised in seeking expansion of their businesses. By being well-learned professionals in a specific industry like clothing, furniture, or automotive parts, they can:

  • Buy mass quantities of the product, allowing them to complete more orders
  • Using cost-effective solutions, they sell to B2B sellers at a better price
  • Get mass discounts while procuring and shipping to increase profit margins

Although this business model has many benefits, they also have several drawbacks. Thus, carefully planned strategies are required to implement these.

  • Complicated needs and limitations for shipping

Because the B2C commerce landscape is evolving to deliver extremely high and optimised customer services, B2B buyers have also adapted to expect the same. It includes quick delivery and order tracking facilities. It also means accurate orders and  24-hour customer service, amongst many others. As B2B orders are generally mass orders, they tend to have huge amounts of paperwork and can be tedious to deliver with the same convenience as B2C. Furthermore, B2B distributors must also accommodate all sorts of customer-specific demands that can vary from client to client.

Addressing Challenges in B2B Logistics: Effective Solutions

Implementing the best practices and strategies to keep with the delivery requirements needs proper navigation through all obstacles. Here are a couple of solutions to the major problems that B2b logistics agents face:

  • Choosing the best technology that meets your needs

Any B2B distributor can handle most challenges by simply adopting the right technology to assist them. Investing in an inventory and order management system can save you a lot of trouble against manual errors. They are also more efficient and hassle-free. Automated processes allow you to complete your orders on time and increase efficiency. Furthermore, traceability also becomes easier. They can also track the KPIs and relevant metrics, making the overall supply chain process more streamlined.

  • Maintaining good relationships

Having a good rapport with your suppliers and clients can simplify all the challenges you encounter in the entire B2B process. Treating your suppliers as equals and making a substantial effort to warm their trust and loyalty can help you make good connections. Making on-time payments and communicating with them regularly can help your reputation. Another good way of building relationships is to maintain transparency. All mistakes, delays, and other details should be constantly updated to build a loyal rapport.

  • Creating a seamless buying experience

The complexities of a B2B transaction are always complex, and creating a user-friendly experience can be difficult. Working and creating meticulous plans for the entire supply chain process will help you gain loyal customers and slowly establish a customer base. Making your websites and applications more user-friendly with personalised experiences can be a brilliant first step.

  • Partnering up with a B2B partner

Using a good partner can help you avoid all the tedious tasks that will come your way for a B2B shipment. Their expertise and reliable and affordable solutions can help create better experiences for your customers.

Advancing B2B Logistics with Shiprocket’s Assistance

B2B logistics solutions are undoubtedly complicated. It requires the help of professionals to ensure that you have hassle-free customer experiences. With Shiprocket, all your B2B needs can be easily met. They offer accurate recommendations for all your shipping needs with budget, data, delivery estimates, carrier tools, etc. The expertise can help you strategise your supply chain process, and they can also assist you with any form of pickups, tracking, and clearing disputes. Furthermore, offer multiple modes of shipping and have a wider reach across the country. Lastly, they are extremely advantageous as they do not levy a fee for using their platform.

Conclusion

Managing B2B operations is a tedious and complicated process that needs careful planning and execution strategies. Businesses can benefit significantly from implementing smart strategies to optimise their B2B processes. The challenges that B2B operations face are extremely complicated, and the right solutions must be used to help overcome them. B2B distributors must incorporate such features in their services that keep customers interested. Using the expertise of a 3PL partner can help you meet all your shipping needs with ease.

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