Retailers who want to play in the b2b game have to master a whole new set of rules

Ordering, payment, fulfillment, delivery, customer service and the sales process all must be modified to make the move from b2c to b2b. B2B retailers must use direct sales forces to bring business to their sites instead of using mass media. They must upgrade web sites to accept purchase orders and more complex product orders. And they must develop packaging, fulfillment and delivery plans that meet the demands of businesses.

Industry participants warn that companies that don’t know how to sell to businesses will not last long. “Business customers expect you to have great prices and have a good selection of products in stock that are deliverable,” says Jackie Shoback, vice president of operations at Staples.com, which has served businesses online since 1998.

The company looked for people experienced in high-level consultative selling to companies of at least $100 million in annual revenue. “The sales process for eStores and other b2b service offerings takes three to six months, and you need people with experience in starting and managing this process,” Neely says. Sales groups must contact businesses directly and tailor their sales pitches to what that company needs and how the retailer can provide it. That’s a clear departure from the mass marketing approach in which Beyond.com had advertising contracts with America Online and Yahoo.

Once a b2b hopeful gets businesses to its web site, it must be able to support that traffic. Fogdog.com launched an institutional store in June to sells sports equipment to schools and other organizations. It had to upgrade its system to accept a higher volume of purchase orders, says Jon Denney, director of group sales. LandsEnd.com had to change its online order forms to accept orders of multiple items in multiple colors and sizes. “Through usability testing, we found that using a buying grid [instead of the b2c order form] makes ordering faster and easier for business customers,” says Mike Grasee, director of corporate e commerce. Aliso Viejo, Calif.-based Buy.com, which launched a business superstore in late July, enhanced its web site by adding alphabetized search functions and multiple ship-to address capabilities, among others features.

Staples.com has its own fleet of delivery trucks, warehouses and distribution centers, a major perk of being part of a large offline corporation. Staples.com also features real-time inventory so customers know when an item is out of stock, when it will be available and what substitute items can be shipped immediately. Fogdog.com has a search feature for its institutional customers to find products that are available to ship within two days. (Most sports and equipment products that organizations order in volume usually take four to six weeks to deliver.)

With merchandising and distribution experts who have backgrounds at Proctor & Gamble and major pharmaceutical companies, BeautyJungle.com set out to build expertise in bringing beauty products online first to the consumer and now to other businesses, including drugstores that order products from them. The online beauty giant, which began its b2b endeavors in January, has its own distribution centers and has applied for a patent on a process for packaging merchandise that makes it easier for stores to unpack and stock retail shelves. Deborah Goslin, executive vice president of sales and marketing, explains that the packing process for products is important to end retailers because of the time it takes to get products on the shelves.

Beautyjungle.com’s eZ-tote organization process packs items in such a way that the person unpacking can place them in the store without having to sort and organize the items prior to arranging them on the shelf. What could take a store clerk hours can be done in 20 minutes, she explains, noting that testing shows a 40-60% time saving for stores. Beauty Jungle.com says the time saved can amount to $5 million to $10 million in saved labor costs for a large drug store chain. With the average 5% margin, the savings is equivalent to a sales increase of $100 million, the company claims. “Supply-chain economics that improve store logistics are very powerful,” says Goslin.

Shoback says having Biz Rate surveys at the end of the order process to chart b2b customers’ shopping experience, as well as maintaining contact points with customers via email comments, is invaluable. “In addition to listening to your business customers, it’s important to have a really good infrastructure that allows you to measure what you are doing to provide for b2b,” says Shoback. Staples.com uses its survey and email feedback to develop new web services. Shoback says business customers’ suggestions are tested in an in-house lab on a continuing basis.

Tested features that are on the site include email reminders for recurring orders, saved shopping lists of items that are ordered on a regular basis and a group profile feature, in which an electronic order form is routed around an office for supplies. This allows multiple people from a company to order office supplies from Staples.com from their desktop. Then the orders are sent to a central designated person who is in charge of approving those orders before sending them on to Staples.com. The company, which touts the feature as helping small businesses control costs, says it is the virtual version of passing around the office supplies catalog.

Apparel retailer LandsEnd.com, which added b2b earlier this year to provide companies with business logo merchandise online, has a customer service call-back and online chat options for its b2b site. Unlike b2c, b2b customers have separate computer and phone lines, which makes the telephone call option important. Providing that customer service link is a big deal for businesses with timely, extensive and complex orders.

Attacking the b2b segment the right way can pay off in the long term. “The nice thing about b2b is that if you do a good job with business customers, they will be repeat customers,” Labatt says. He says business are better customers because they are more loyal to good suppliers and spend more than consumers—an average ticket of $80 for consumers versus $150 for businesses who order from an online grocer.