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If you’re new to the industry, it might be a challenge at first to understand the differences between B2B fulfillment and B2C fulfillment and how they fit in the supply chain.
Both deal with inbound and outbound logistics processes. While B2C fulfillment is focused on smaller orders, B2B ecommerce fulfillment is more focused on lower order volumes, but higher quantities of product. B2B also has more regulations and the cost associated with B2B can be more costly (depending on certain factors).
In this post, we’ll go over the key difference between B2B fulfillment and B2C, and how to source the right B2B fulfillment provider for your ecommerce business and also select the ideal fulfillment company to fit your fulfillment needs as your business expands.
Here’s what we’ll cover:
- What is B2B fulfillment?
- B2B vs. B2C fulfillment
- How B2B fulfillment works
- What to look for in a B2B order fulfillment service
- How ShipBob fulfillment centers make B2B fulfillment easy
B2B fulfillment focuses on fulfilling orders to other businesses or retailers rather than directly to consumers. B2B orders are often bulk orders that are shipped via freight or parcel for smaller orders. B2B fulfillment helps other businesses stock up on product so they can resell to their customers through one or multiple channels.
B2B fulfillment vs. B2C fulfillment: how they’re different
Although both B2B and B2C (business-to-consumer) follow the same steps of the retail fulfillment process, the methods in each stage are different, especially when it comes to shipping methods, costs, and speed.
“Most recently our sales have exploded not just for online DTC orders but we’ve also seen a lot of B2B growth. While our Instagram and Facebook ads are directed toward consumers, our customers are often decision makers for a business. There can be a gray area in knowing which use case someone is buying for, but we want to get it right since we have different funnels and approaches in how we cultivate loyalty, enable repeat purchases, and market to DTC vs. B2B customers.”Andrea Lisbona, Founder & CEO of Touchland
Order and unit volume
B2B orders are much larger in terms of quantity and lower in volume. Oftentimes, your B2B customers will only order every few months, but the purchase quantity will be much larger. B2C orders usually have fewer items in an order, but are being delivered directly to different residential locations.
Because they tend to be larger and bulkier, the shipping and logistics of B2B fulfillment are far more complex. B2B orders are mostly shipped via freight and palletized because of the number of items involved compared to most B2C orders. However, if the B2B order is small enough and can be packed in boxes, then it is possible to ship B2B orders via parcel.
Depending on the industry, there are regulations for how to ship products B2B. This includes hazardous materials, heavy items, international shipping, and more. B2B orders also must comply to more complicated regulations, especially when it comes to EDI (electronic data interchange).
Since B2B fulfillment deals with larger shipments, orders are much more expensive and valuable, and oftentimes requires more labor and handling equipment (e.g., loading and unloading pallets).
B2B fulfillment is oftentimes more time-sensitive and it can be a challenge to get B2B orders out on time if strict regulations are not followed.
While 2-day shipping isn’t a major selling point for B2B businesses, guaranteeing delivery dates is the best way to build trust with other businesses and retailers who depend on your B2B delivery to keep their store’s inventory stocked.
How B2B fulfillment works
B2B fulfillment solutions establish long-term relationships with their big-box retailer and/or ecommerce clients, who place annual orders periodically throughout the year. They exchange data via EDI systems that allow them to update orders in real-time.
What to look for in a B2B order fulfillment service
Finding the right B2B fulfillment provider for your business is important. You have to make sure the fulfillment partner is able to follow requirements, have a history of not missing deliveries, have experience with B2B fulfillment, and can provide customer service to you when needed.
EDI is a combination of both systems and processes that give retailers the capacity to exchange documents and transactions with their suppliers, vendors, and brands in a standard electronic format.
For instance, a retailer can send a digital purchase order to a vendor through EDI instead of sending a paper document. The opposite is true as well; a vendor can send digital invoices and other transactional documents to their retailer partners electronically.
If you’re working with a B2B fulfillment provider, make sure they’re EDI-compliant as this will make the order fulfillment process smoother and easier to work with.
“Our business is about 75% B2B. Some of that is through mom-and-pop sports retailers, some is with major retailers like Dick’s Sporting Goods, Scheels, and Sports Endeavors, and of course we have grown with Amazon as well.
Each of these retailers has their own unique EDI requirements for B2B orders, and you cannot do business with them without complying with their specific rules. Luckily for us, ShipBob can accept, and adapt, to each individual retailer’s technical needs and requirements.
There are a lot of different routing guidelines and trading requirements, but ShipBob’s EDI integration makes it easy to handle them. It’s helpful for us to not have to worry about compliance issues on our B2B orders – especially when so much of our business relies on getting it right.”
Tyler Stelter, COO at Storelli Sports
Responsive customer care
Issues with orders can happen. Because B2B businesses are so reliant on having the right products in stock, you need to have a provider who can handle your issues quickly. Look for a B2B fulfillment provider who prioritizes customer services and takes the B2B relationship seriously.
When you work with a B2B fulfillment provider, make sure they have the right technology that allows you to track current B2B orders, track packages, and place new orders all in one location.
“Outsourcing both retail and DTC order fulfillment to ShipBob really just gave us the flexibility that we needed to effectively grow our business — not just the DTC segment, but the retail segment also. Honestly, it changed the game for us. So we were just thrilled that ShipBob has come to lead the way in providing fulfillment solutions for small to medium sized businesses like ours.”Nathan Garrison, Co-Founder and CEO of Sharkbanz
How ShipBob fulfillment centers make B2B fulfillment easy
ShipBob is a tech-enabled 3PL that partners with fast-growing ecommerce brands that primarily ship orders directly to customers from our various distribution centers, and but also provide support to businesses who need, but also need digital fulfillment support for small-volume B2B orders.
ShipBob’s B2B Fulfillment Suite and EDI capabilities enable merchants to sell throughout the entire B2B ecosystem, powering retail dropshipping (fulfilling orders placed on big box retailers’ websites) and wholesale shipping (including brick-and-mortar stores), which can connect with all the major retailers.
“ShipBob knows how to fulfill orders for major retailers, and that knowledge shines through in their EDI-automated B2B solution. With important details that differ between retailers – like freight carrier preferences or limitations on package and pallet size – ShipBob automatically complies with them. I don’t have to keep tabs on or communicate those details anymore. It’s a huge time-saver for my team.”
Nadine Joseph, Founder & CEO of Peak and Valley
Although ShipBob is not currently EDI-compliant, ShipBob offers B2B fulfillment for non-EDI wholesale orders (e.g., for boutiques, Whole Foods, Urban Outfitters, to name a few). Here’s how ecommerce businesses work with ShipBob as a third-party logistics partner to offer B2B fulfillment:
Reduced fulfillment and shipping costs
ShipBob makes it easy to place a B2B order directly from the dashboard. Simply put in your order including the business address you’re shipping to, packaging instructions, the quantity, and the shipping method (parcel or freight).
“As we expand with B2B and B2C orders, ShipBob’s pricing structure remains simple without any add-on charges. With most 3PLs, you will see a lot of hidden fees when you do your homework. ShipBob doesn’t play games — the pricing is clear and easy to understand.”Matt Dryfhout, Founder & CEO of BAKblade
By placing a B2B order through ShipBob, you can take advantage of faster shipping at a lower cost.
Better inventory management
Running your own warehouses and storing B2B inventory can be costly, complicated, and time-consuming. You also have to count inventory every day, manually reorder more inventory, and manage labor.
By working with ShipBob, we handle all of this for you. We also offer a free fulfillment data and reporting tool that offers insight into fulfillment performance, shipping data, demand forecasting, and logistics costs.
B2B ecommerce fulfillment is a growing market because many businesses are seeing the advantages of ordering products online. If you want to offer B2B products to expand your ecommerce business, gain a competitive advantage, and improve B2B fulfillment services, now is a great time to do so.
To learn how ShipBob can help you with B2C and B2B fulfillment, click the button below to request a quote.