Supply Chain Mgmt In B2B And B2C Environment

Supply Chain Management in B2B and B2C Environments

Supply chain management, whether in a traditional or E-commerce environment, involves distributing products, goods and services from point of manufacture to the delivery of the final product. Supply chain management, whether related to B2B or B2C retailers involves manufacturing, storage, distribution and delivery of products and services to consumers and other businesses. B2B supply chain management is slightly more complex than B2C transactions, as B2B wholesalers, distributors and manufacturers are typically working with larger corporate entities. For supply chain management to work in a B2B or in a B2C environment, the focus must be on provider customers with the utmost in quality services. The specific differences and similarities between supply chain management for B2B and B2C are explored in greater detail below.

According to Stephen David, CIO and B2B officer for Procter and Gamble, building a successful supply chain depends upon "the ability of manufacturers to develop a successful consumer driven system" (Reese, 2004). According to the successful business chain entrepreneur, the primary market for today's manufacturers is declining, thus "B2B supply chain management should not be focusing on consumer goods, but rather new categories" (Reese, 2004). Supply chain management in B2B must focus on the "fragmented market", comprised of very different types of consumers. B2B customers have very specific demands, and what works best in this environment is a "consumer-driven supply network that operates in real-time, is data driven and supplies products on demand" (Reese, 2004).

Supply chain for B2C sites must involve tracking the number of hits and level of traffic reaching the website, more so than in a B2B environment (Patton, 2004). According to Jupiter research, by 2006 Business to Consumer E-commerce organizations might be spending as much as $1 billion to analyze websites and account for consumer spending (Patton, 2004) in the B2C environment.

Operating in real time is important for supply chain management in B2C environments, because it allows manufacturers to "perfect real time transactions", which are typically requested of mega vending retailers (Reese, 2004).

B2B differs from B2C's in some respects, such as its reliance on other avenues of supply such as product catalogs. The largest market in the U.S. for B2B supply chain operations is providing strategic resources such as: capital equipment, direct materials and strategic services, closely followed by the commodities market including: utilities, transportation and direct materials (Kerns, Bruce 2000).