Amazon Business is Growing Fast – Can Small Players Compete?

The answer is unequivocally yes! With the right wholesale distributor software small- and mid-sized companies can compete with Amazon Business - if they respond quickly and appropriately. We lay out some steps below that you can take quickly to respond.

Amazon already owns the consumer market and is now going after wholesale distribution.

In an increasingly competitive distribution market, a mega player like Amazon poses a significant threat to small- and mid-sized distributors. Amazon already dominates the consumer market -- and is quickly making progress in the wholesale distribution market through Amazon Business, its B2B platform. Amazon’s wide reach covers most wholesale distribution sectors such as irrigation, fasteners, janitorial & sanitation, and power transmission. Amazon Business offers over 60 million products, quantity discounts, free two-day shipping for purchases more than $25 going to a single destination; recurring delivery, an extensive customer service call center, a Live Experts chat function that connects buyers to the product company’s reps, and lines of credit.

Amazon’s market power stems largely from its incredible ability to take advantage of the Internet and acquired e-commerce experience. Both of these technologies are considered “disruptive technologies,” and they’ve quickly and drastically changed the way that goods are purchased. Like any savvy large-scale corporation, Amazon has seen a way to leverage its strengths to go after the distribution market, in the same way as it dominated the consumer market. Smaller and slower players that don’t respond will fall behind.

Just because your distribution company isn’t Amazon-sized doesn’t mean it can’t take advantage of disruptive technologies, too.

By investing in wholesale distribution software that allows you to serve customers like a large market player -- and by playing to your natural strengths as a small market player -- you can find success in these technologically changing times.

Enter the e-commerce arena.

If you haven’t already set up online stores on an e-commerce platform (like Magento, Shopify, Woo Commerce) or e-commerce marketplace (like Amazon, eBay, Walmart) to sell your products, do so ASAP. The list of reasons why e-commerce makes sense for any small- to mid-sized distributor is too lengthy to illustrate here – so for an exhaustive list and some tactical ideas, download “How to Survive as a Distributor in the Digital Age”. You need to make sure your online stores can be easily linked to your wholesale distributor software. Doing this will let you manage the products you sell in the online stores and fulfill orders that are placed in the online stores directly from your wholesale distributor software. Not all wholesale distributor software can easily link to e-commerce stores so make this one of your key criteria in selecting your ERP system.

Boost your online presence.

As more and more business to business (B2B) purchases take place over the Internet, your company needs to fight for search engines’ attention. Implement an SEO (search engine optimization) strategy that includes proper meta-tagging, keyword choice, and image tagging. Produce fresh content regularly through a company blog and through social media to ensure your online presence is strong and spans across multiple channels. Make sure your e-commerce interface is modern-looking: an antiquated appearance is a turn-off to visiting browsers and new potential customers.

Retain customers through good customer service and smart Customer Management (also known as CRM) software.

Recent estimates suggest that more than 60% of B2B buyers have purchased at least once from Amazon Business -- meaning Amazon Business already has valuable data on the majority of B2B buyers – some of whom are your customers. Invest in smart wholesale distribution software that has a built-in CRM and manages your consumers’ contact information, purchase history, and preferences, so that you can cater to their needs and segment them into logical groups. Even if you don’t feel you need a CRM now, invest in wholesale distributor software that includes this -- as your company and client base grow, your customer relationships will become more complex. Also, many sales teams become attached to particular CRMs, so make sure you’re your wholesale distributor software can easily link to 3rd party CRM solutions.

Provide outstanding customer service through strong wholesale distribution software.

B2B customers’ top priorities, in order of importance, include: product availability, customer service, on-time delivery, one-stop shopping, technical support, and price. Good wholesale distribution software allows you to satisfy customers’ needs by ensuring that orders are processed quickly, delivered efficiently, and supported extensively. Note that trends change quickly -- so make sure your wholesale distribution software is built on an adaptable, scalable framework. Though your company might not need complex features now (such as the ability to manage transactions in multiple currencies), it could in the future.

Take advantage of your small size.

Though mega players like Amazon Business do have extensive customer support systems, an Amazon customer service representative likely doesn’t have the extensive industry knowledge that you or your employees do. Show clients the value of your specific industry expertise, and give them individualized, personal attention. A small-sized distribution company can deliver more flexible, personal, and specific customer care than a large-scale company -- which can help make your company stand out in a customer’s eyes.

Summary

If you are concerned about being able to compete, contact us to learn what Accolent ERP, Cloud-based wholesale distribution software, can do for your business. Whether you need e-commerce options or want to improve your CRM or customer service, we can help.