The purpose of this paper is to examine the differences between the business-to-business (B2B) and the business-to-consumer (B2C) supply chains. The first step is to define the terms supply chain, B2B and B2C, and compare the supply chain characteristics in each business type.
The Supply Chain "A supply chain is a coordinated system of entities, activities, information and resources involved in moving a product or service from supplier to customer. The entities of a supply chain typically consist of manufacturers, service providers, distributors, and retail outlets (Dictionary.com, 2007)."
Business-to-business (B2B) is the exchange of products, services, or information between businesses rather than between businesses and consumers (SearchCIO, 2006), or e-commerce between businesses. Electronic technologies and mostly, the Internet have drastically changed the B2B marketplace. Procurement processes, or the purchase and sale of materials and supplies between businesses and a key element in the B2B supply chain, have completely changed and are considered to be fluid in the most competitive systems. Some examples of categories where B2B websites may fall include the following:
2.Product supply exchanges
3.Industry portals (specialized)
4.Brokering sites In the past, most procurement activities were slow and labor intensive, taking place by telephone, mail, fax or in-person. Now they are achieved through highly integrated and often real-time systems that communicate worldwide, across many different platforms, in many different languages and coping with many different types of currency.
As an example, W. W. Grainger is one of the first B2B suppliers with an online presence. Grainger began integrating technology into its supply chain operations very early, starting in 1991 with the first digital maintenance, repair, and operating (MRO) equipment catalogs. Grainger supplies businesses worldwide with MRO products via a sophisticated system of electronic ordering, processing, fulfillment, and delivery. Grainger's supply chain includes all of the suppliers and manufacturers upstream from its- website who fabricate the supplies and equipment that it sells.
Business-to-consumer is basically retailing on the web, and the business method used online to sell products directly to consumers. For most businesses, the Internet has enabled B2C significantly to increase the customer base, and to improve the ability to support transaction, and related issues without increasing, and in many cases even decreasing cost.
Examples of B2C enterprises include the bookseller Amazon.com and Walmart.com. In the 2 cases, the B2C or downstream supply chain consists of the retailer and the customer.
B2B Supply Chain Collaboration is the key to B2B supply chain success. How well a business is able to communicate with its supply chain partners helps maintain inventory control and keeps the supply pipeline flowing. Companies now could communicate with trading partners up and down the chain instantly. Through economies of scale, system integration, and increased competition, B2B also uses e-business and electronic supply chain solutions to reduce transaction costs with suppliers and to speed their products to market. In the new economy, companies are driven to increase the speed and efficiency of supply chain activities, and reduce transaction costs. In order to do so, companies must achieve greater coordination and collaboration among supply chain partners. Among the issues is the ability of multinational companies to quickly and easily share knowledge across platforms, and to collaborate (negotiate) in real time; Part of this issue is bringing the suppliers on board. This can mean helping companies understand why it is in their best interests,…