Comparison of B2B and B2C Companies This report is a supply chain comparison between two companies in which one is a business-to-business (B2B) model company and the other is a business-to-consumers (B2C) model company. The comparison will be between the companies Wal-Mart and Grainger. Wal-Mart is a well-known conglomerate known around the world that is in the retail business that seeks to sell products to consumers at a significantly reduced discount compared to its rivals. Grainger sells supplies to different companies through the company 's own website.
First, let 's start by distinguish between what a B2B company is and what a B2C company is. The definition of a business-to-business is when businesses sell products or services
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Grainger supplies its business to a variety of businesses but sells primarily to industrial and commercial maintenance departments, contractors, and government customers. The company sells more 800,000 products so Grainger relies heavily on the use of more than 1,200 suppliers to fill this need. One interesting fact is that nearly 40% of their purchases are from random purchases from customers that rarely buy the same product more than once a year (Grainger 2006 Fact Book). So how does Grainger fulfill these needs and keep customers happy? Grainger operates in the United States by having 416 branches, 10 distribution centers, and its own website. What separates Grainger from competition is the fact that Grainger offers the best combination of product selection, local availability, and speed of delivery. In fact, 99 percent of customers receive their orders the very next day. Grainger recently launched a catalog in 2006 that contains more than 115,000 products. That is a staggering number of products available for customers and a lot of information for Grainger to be accountable for. Grainger began offering customers the availability of ordering online in 1996. By implementing electronic ordering options, profit margins are significantly higher than the previous mode of ordering which was by phone or branch orders (Grainger 2006 Fact Book).
Reference
Schneider, G. (2004) Electronic
Westminster Company is a giant Global manufacturer of health products whose brand has been recognized by the world. As the company they have three different operations which produce and distribute different product lines. Their main strategy on which they are working and which is a major success for them is decentralized management. Now they are re-evaluating their traditional supply chain strategy because the company is getting too much pressure from their large domestic’s customers and global customers. Now the company has to study on
B2C stands for Business to Consumer as the name suggests, the basic concept of this model is to sell the product online to the consumers. B2C is the indirect trade between the company and consumers. It provides direct selling through online interaction.. Business to
In 1927, William W. (Bill) Grainger started a wholesale electric motor sales and distribution business in Chicago which provided customers a convenient and efficient way to access a consistent supply of electric motors. A year later, the business was privately
The food industry is an extremely diverse and multifaceted market. Some companies have succeeded using a highly segmented approach, focusing on a niche market like Whole Foods, while others have succeeded with adopting a generalizes strategy. Regardless, the company must have a clear idea of to whom it is selling and the value proposition it offers to customers. Given the level of competition, Kudler Fine Foods must make the case to customers that it is offering them something unique that cannot be found elsewhere. "The reason that marketing is so important to businesses is that it is how you get customers. Clearly nobody is going to walk into your office and ask for whatever it is that you are selling unless they know that you are there and what you are selling. The way that you make sure that they do know is through marketing" (Why is marketing important to businesses. 2012, NBM Communications).
The grainger.com website, which hit $1 billion in sales in 2007 had, until recently been operating at a negative margin, with a write-off of $125 million in 2001, grainger.com has gone back to the basics. Yet, one of Grainger’s most significant core competencies will always be with the company’s knack to efficiently manage logistics, supply chain and warehousing of over 188,000 products in 9 distribution centers, and over 450 branch based stores.
Building a B2B eCommerce platform generates big differences from trying to market retail products to consumers. Unlike B2C marketing, cultivating each potential buyer is more critical and challenging. Most business buyers are highly educated, logical and perceptive, so they tend to appreciate platforms that offer them conveniences for researching products and product lines, managing complex shipping strategies and handling special needs such as winning approval from buying committees or multiple decision-makers. That 's why it 's important to develop a business-marketing strategy that incorporates buyer identification, expedited searches for product and, third-party information about product specifications and supply chains. B2B platforms share some similarities with B2C websites, but there are many inherent differences that marketers need to understand.
Walmart is equally ranked among the highly valuable companies, in terms of market value, as well as the biggest grocery retailer where it generates more than 51% of its sales from the grocery business. This paper explores Walmart’s operation management with regard to supply chain characteristics, global business operations, production processes, the company commitment to quality and excellence, inventory methodologies, operational planning and movement towards lean processes (Massengill, 2013).
Wal-Mart Stores, Inc. the World’s largest retailer, has a bullseye on its back in all different directions from supermarkets cutting prices to match Wal-Mart’s price, to Costco leading the warehouse market and online retailer beating out Wal-Mart.com. In addition, 2008 brings an economic slowdown and reduction of feet through the doors of Wal-Mart Stores. Added to this, Wal-Mart has received negative publicity relating to employee compensation and benefits, forcing pricing challenges for suppliers resulting in the loss of U.S. jobs and opening stores putting locally owned retail outlets out-of-business. Wal-Mart has over 6,8001 stores worldwide with a strong internet presence supported by over 66,000 suppliers.
Surprisingly, Wal-Mart Stores Inc. has continued to grow exponentially without any real threat to their business due to their extensive supply chain model and management. Innovation was their special ingredient in disrupting the retail industry by creating more effective and efficient ways of managing their supply chain and inventory. In fact, the most interesting aspect of the strategy was not merely adding, but actually removing associations in the supply chain which in effect, caused numerous advantages for Wal-Mart; less expenses, more simplified system of flow which produces fewer errors from looming.
“Considering present market conditions and the way in which industry demand fluctuates nowadays, firms willing to remain operationally efficient will become more reliant on supply-chain management, This is one of the main reasons for which Wal-Mart has been capable of growing at an annual rate of 15.4%.”(Aleksandrov)
When we, at Edfora, set out to design B2B products such as SchoolPAT and HelloApp, the first question to be asked was - “How designing a B2B product should be different from designing a B2C product?”. Ideally, there should be no difference except the targeted user. All the differences in designing a product for the users inside an organization arise out of the differences in the nature of a B2B user vis-à-vis B2C user. Few of them can be listed as below:
B2B is a type of transaction that exist between businesses, such as one involving a manufacturer and wholesaler, or a wholesaler and a retailer. B2B marketing is marketing of goods and services to commercial enterprises, non- profit organisation, government, independent businessman for use in goods and services that they, in turn, produce for resale to other industrial customer or final customer.
The primary differences of a B2C and B2B website when discussing the legal, ethical and regulatory issues associated with these sites are the result of the differences in the end user of the site. The primary user of a B2C site has an objective to sell, receive and process purchases and to provide
• Describe and critically analyze the supply chain management practices employed by both of these companies.
W.W. Grainger founded by William W. Grainger, started out in 1927 as a wholesale electric motor and distribution business in Chicago, Illinois (W.W.Grainger inc, 2005). William established the company to provide an efficient solution for fulfilling business consumers’ needs. In 1928 the business was incorporated as W.W. Grainger Inc. Sale orders back in the 1920’s were made mostly through mail orders from catalogs or postcards that were given out to customers. To improve sales and customer service William Grainger opened the first Grainger branch in Philadelphia in 1933. By 1936 Grainger had opened a total of 15 branches across the United States (W.W.Grainger inc, 2005). William Grainger knew that by having actual Grainger stores it would increase his total sales and it would build a larger consumer base. In 1967, Grainger became a publicly traded company.