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Future of B2B

The use of the Internet to facilitate ecommerce among companies promises vast benefits:
  1. dramatically reduced costs,
  2. greater access to buyers and sellers,
  3. improved marketplace liquidity, and
  4. new array of efficient and flexible transaction methods.
But if the benefits are clear, the path to achieving these benefits is not clear. The B2B market is still in its infancy, and its structure continually changes. Despite press coverage, little is known about how business-to-business commerce will evolve on the Internet

The high level of uncertainty is causing widespread anxiety among executives and for good reason. Whether as buyers, sellers, or both, all companies have substantial stakes in the business-to-business marketplace. Their supply chains, their product and marketing strategies, their processes and operations will be shaped by the way B2B relationships are formed and transactions are carried out. Yet at this moment even the most basic questions remain difficult for companies to answer:
  1. Which exchanges should we participate in?
  2. Should we form a trading consortium with our competitors?
  3. Should we demand that our suppliers go on-line?
  4. What software should we invest in?
Executives understand that the wrong choices could have dire consequences, but they also know that in the fast-paced world of the Internet they need to act soon or they will be left behind.

Supply webs and challenges

  1. B2b ebusiness involves connecting the raw material of suppliers, part suppliers, distributors, shipping and freight suppliers, warehouses, and financial partners into a complex maze of what are known as supply Webs. Just as the consumer now has many more buying options than before, every point on the supply chain will face a similar expansion of choice.
  2. The underlying technology of B2B based on EDI and SWIFT originally, will make extensive use of new integration technologies such as XML, to increase the level of automation between business. While B2B will bring new opportunities to improve efficiency in the supply chain, it will also raise new technical challenges in the area of security, reliability, and transaction processing.