With B2B eCommerce continuing to gain stream, B2B VARs (value-added resellers) have an expanding opportunity to reach their business customers digitally and capitalize on the digital commerce movement.
But as entities that are positioned in the middle of two key partners — a brand that provides a product to be resold, and the customer that ends up purchasing it — VARs also stand squarely in the midst of two related, but unique, workflows: procurement and B2B eCommerce. VARs must not only streamline their procurement workflows from the bands whose products they sell but also be able to turn around and provide a digital purchasing experience on eCommerce platforms for their customers.
Traditionally, said Shiv Agarwal, director of sales at VARStreet, the solutions that can bridge that procurement-eCommerce gap, and that provide the kind of broader integrations to support a seamless business operation, are typically expensive and reserved for larger organizations. Yet small and medium-sized VARs eager to embrace digitization in both the front and back offices need modern, agile solutions, too, he recently told PYMNTS.
SMB VARs’ Tech Struggle
“There are very few applications — largely only ERPs — that can take care of small and medium B2B businesses’ end-to-end requirements,” noted Agarwal.
The most sophisticated solutions are designed for larger firms, leaving small to medium-sized businesses (SMBs) in the B2B VAR arena to cobble together a variety of disparate solutions. And according to Agarwal, there is a lot that they need.
In the back office, VARs require seamless ways to connect to distributors and procure products from their catalogs. This might include inventory management and eProcurement solutions as well as ways of paying those suppliers.
On the front end, meanwhile, these businesses also require robust eCommerce tools to connect with corporate buyers, B2B payment solutions to accept payments, and sales, quoting, and customer relationship management (CRM) tools.
Altogether, Agarwal said, this makes for an expensive and non-integrated way to operate a business. Adding greater friction to this workflow is the need for these various back-office workflows to connect to the front office. After all, the turnaround between receiving an order from a customer and having to procure that product from a distributor must be quick.
“Nowadays, a lot of businesses operate in a drop-ship model, where they do not maintain an inventory but procure only when they get orders from end customers,” he said, adding that these resellers must “connect with their suppliers at the back end and place a back-to-back order once they receive an order from the end customer.”
Elevating Buyer Experiences
The challenge of marrying a VAR’s buying experience with its selling experience is particularly difficult today considering the elevated expectations that many corporate customers hold. In addition to a fast turnaround between when an order is placed and able to be fulfilled, Agarwal said many buyers also seek punchout functionality, which allows them to view a seller’s catalog from their own portals. They also want to receive quotes regardless of the physical location of a seller, meaning that the seller needs mobile solutions to generate and submit quotes to clients while working remote or traveling. Further, he said, sellers are increasingly pressed to offer both hardware and services within the same platform.
Access to the right technology is critical to enabling VARs to step up operations and meet modern-day demands on both the buying and selling sides of business. Agarwal highlighted the opportunity for integrated, connected solutions that can expand across the front and back offices to not only create efficiencies for VARs but accelerate B2B payments and improve financial positions too.
“Running everything in an integrated way will impact cash flow, profitability, customer satisfaction and ease a lot of day-to-day pain points of running a business,” he said.