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B2B vs B2C Supply Chain Management
B2B vs B2C Supply Chain Management

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Any person in business for themselves or that has owned a business will tell you that technology has brought business up a long way and keep evolving tremendously. Just a few decades ago brick and mortar was the only way to open and run a business. But now, the internet and technology has put new ideas into businesses owner’s heads. New reach customers and other businesses can be reached all over the world within seconds. This has caused a great surge in the world wide economy. In 2003 Business to Business (B2B) commerce tipped the scales at $1.41 Trillion. This is in comparison to Business to Consumer (B2C) that was $90.1 Billion (Naraine, R.2003). All of these purchases need to get transported some kind of way and that is where businesses supply chains come in play. To the average person the supply chains of B2B and B2C are the same however they are not the same both have unique qualities. This paper will attempt to define the term supply chain, B2B and B2C. I will also explain how the supply chain differs on a B2C sites compared to a B2B sites and provide examples.
Supply Chain
According to learnthat.com a supply chain is the series of channels a product takes from its initial production to reach it’s finally destination (Learn That, 2004). A good example of this chain of events that occurs in everyday life would be when a guest walks into an electronic game store and purchases a Game Boy. The supply chain begins with the guest and the desire for the game. Then it continues to the brick and mortar store. This game store receives its product from a distribution center. The distribution center receives the product from the manufacturer. Finally, the manufacturer receives the raw products from several other suppliers. This basic supply chain is fluid and continuously goes back and forth.
B2B
When I think of B2B or business to business I recall the classic image of an old style ice salesman traveling from business to business delivering ice in order for them to keep their merchandise cold. Fast forward 60 years and now B2B eCommerce occurs when companies are buying from and selling to one and other online. B2B eCommerce has evolved past just basic purchasing. It is now encompassing supply chain management as more organizations continue to outsource parts of their supply chain to their trading partners (Varon, E., 2001).
A much better example of a real world B2B is PharmasMarket.Com. It is an independent B2B pharmaceutical e-marketplace, based on a unique business model that delivers quantifiable value. Its mission is to promote dramatic savings on prescription drugs by directly linking pharmacists with pharmaceutical manufacturers via the Internet.
Leveraging Internet technology, the PharmasMarket.Com e-business model addresses current supply chain inefficiencies to deliver more variety at substantial savings. PharmasMarket.Com is creating the single largest online source of prescription drugs for hospitals, nursing homes, retail pharmacies, and other buyers of pharmaceutical products. By eliminating unnecessary “touches, PharmasMarket.Com simplifies the complex system of trading partner relationships that restrict the seamless flow of business between pharmaceutical manufacturers and pharmacists (U.S Pharmacists).
Today, a large number of transactions are almost exclusively conducted on paper—that’s over 10 billion transactions on 150,000 products whose prices change, on average, 42,000 times per year. With 1,000 manufacturers and 35,000 healthcare providers, each with a different membership classification, and each entitled to a different type of pricing…well, it’s a mess. And then maybe you’ll get a rebate and, if you pay early, maybe you’ll get a discount. PharmasMarket.Com doesn’t simply overlay a web-based tool…it cuts the inefficiencies from the system. The products of over 1,000 pharmaceutical manufacturers are consolidated in an online catalog. As the world’s single largest online source of prescription drugs for hospitals, nursing homes, retail pharmacies, and other buyers of pharmaceutical products, PharmasMarket.Com will make it possible for pharmacists to do all things (U.S Pharmacists).
B2C
B2C is pretty straight forward and simple with the title business to consumer, it brings to thoughts of a customer going into a store and making a purchase. When I think of B2C e-commerce, I vision many different websites that offer products for sale; these sites include Overstock.com Target.com, Wal-mart.com, Amazon.com, etc. However, this is just the tip of the iceberg. B2C eCommerce now has grown up and includes thousands of online services. Some of these services can and do include online banking, travel services, online auctions, health information, real estate as well as some less reputable sites (Patton, S., 2001).

B2B vs. B2C Supply Chain
The B2B and B2C supply chains might appear to be similar however, that assumption can not be further from the truth. A major difference between the two is the amount of channels a product must flow through before reaching the end user. With B2B there are less total channels however they are greater in size when you compare to the greater amount of smaller channels with B2C. (Marketing Profs, 2005) For example: A new motorcycle manufacturer is looking for tires to put on their new line of motorcycle. They would deal directly with a tire manufacturer to get their product. The channels would simply be from the motorcycle manufacturer to a tire manufacturer to raw supplies dealers. Now let’s look at an individual looking to book a flight and hotel in Arkansas from Miami. The chain would be as follows, individual, an online store, an airline, an airline staff – hotel, a hotel staff. The next difference comes with technology and that is integration, B2B needs to be integrated to their business partners’ software for smooth re-supply, billing, etc. This is an aspect that the B2C does not have to worry since the customer will return to them out of loyalty versus convenience. Once again we will use the examples above once the motorcycle manufacturer signs a deal with Firestone the systems will have to communicate so Firestone knows how many vehicles are going to need tires delivered for the next week and so forth. They will also have to account for the tires received and charge the company accordingly, with integration billing and payments can be transferred back and forth. In the case of booking the flight and hotel, the B2C does not have to be integrated due to the fact that this might be a one and only transaction with this customer (CIO Decisions, 2005)

Conclusion
In conclusion, as demonstrated not only has technology changed the relationship between a business and it customer, it has also changed the relation of business to business. The supply chains of both have become faster moving yet still as challenging and as different as ever. The shorter and larger scale b2b versus the smaller b2c, these both are still extremely successful in creating a more global economy and with improvements should provide continuing success.


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