Amazon B2B - Is It Right For You?

What Exactly is B2B Selling on Amazon?

The business model of most sellers on Amazon is designed to appeal to retail consumers. For many of those sellers, that B2C model is the highest, best and most appropriate focus for their Amazon venture. Other sellers, however, may be wondering if they should scale their business by selling “B2B” as well - offering merchandise to the million plus business buyers on Amazon Business.

The below information is intended to help you determine what Amazon Business is, what to expect in regard to it, and whether it is right for you as a seller on Amazon.

It is a business seller program that targets business buyers. Through Amazon Business, Amazon provides a platform for small and large businesses to buy from and sell to each other. Lots of wholesalers and manufacturers sell to other business via other ecommerce platforms, but B2B selling on Amazon is B2B ecommerce done the Amazon way.

Amazon B2B - Two people meeting about Amazon B2B.
Amazon B2B - Woman on the phone and working on her Amazon business account.

Who is Amazon Business for?

Amazon’s B2B marketplace is for sellers who want to sell to business buyers, people who buy for work, and managers who oversee buyers. The types of operations involved in B2B ecommerce on Amazon include:

  • Consumer retailers who have the type of inventory that can also appeal to businesses, and the desire to expand their operations in that direction
  • Existing, small B2B ecommerce sales entities
  • Larger manufacturers, wholesalers and distributors looking to expand their current B2B sales channels, whether traditional or ecommerce
  • Procurement and sourcing specialists
  • Government, education, healthcare and nonprofit entities

Not for Everyone, But...

Some wholesalers, distributors and manufacturers who maintain their own ecommerce sites view the Amazon Business platform as a threat to their internal platforms and, for this or other reasons, choose to remain independent of Amazon. Amazon does indeed have a track record for disrupting the scenarios of many of the marketplaces it enters, so it is likely that their B2B ecommerce platform and all of the categories within it will eventually follow suit.

That is precisely why other wholesalers, distributors and manufacturers flip that thinking, preferring to see the benefit of testing the the Amazon waters now, as a parallel channel to their own ecommerce platforms.

Smaller businesses who have sidestepped Amazon in favor of the their own ecommerce platforms may be wise to begin hedging their bets by establishing a firm foothold in both. According to an article recently published in Forbes, entitled Amazon's Customer Loyalty Is Astounding, Pamela N. Danziger writes “...rather than fighting it, which seems increasingly a losing proposition, maybe a better choice is to join it and see how it can help businesses reach new customers. As the saying goes, ‘Better the devil you know than the devil you don't.’”

Those sellers going the duo-channel route may be well-positioned for success regardless which way the B2B ecommerce scales ultimately tip.

One thing is certain: as more millennials increasingly attain positions with buyer-seller decision-maker responsibilities, the tendency will be to go to large, trusted and familiar ecommerce marketplace platforms like Amazon’s to conduct business.

Amazon B2B - Cellphone illustration with the word buy on it.

How Does Amazon Business Work?

Amazon B2B - Pie Graph and Tablet preparing for Amazon B2B meeting.

The 2 Programs of the Amazon B2B Marketplace

Amazon offers two B2B programs that will let businesses engage with other businesses via the Amazon B2B marketplace. One is for sellers, the other is for buyers. The buyer and seller programs work hand in hand, allowing businesses who buy products on Amazon to connect with businesses who sell products on Amazon.

Amazon Business Sellers Program

There are two ways to sell to businesses on Amazon, with the fees for both currently being equal:

  1. Existing retail sellers can add Amazon Business features through their Seller Central account
    • Sellers must register for the "professional seller" program
    • Eligibility is based on performance history, although some special exceptions may be granted
    • Access to all programs previously enjoyed as a retail seller remains the same (FBA, Sponsored Products, Amazon Home Services, Amazon Payments, etc.)
  2. Manufacturing, wholesalers and distributorships new to Amazon must register as “Professional Sellers”
    • There are some differences between retail selling on Amazon and the Amazon Business Seller program. The latter greater attention and adherence to aspects of business-related transactions, among them:
      • Sellers must offer quantity pricing and business pricing
      • Sellers must adhere to higher performance standards related to:
        • Shipping rates
        • Order defect rates
        • Tracking
        • Packing
        • P.O's
    • Some discerning business buyers give preference to merchandise sources who have attained certain standardized credentials. Amazon offers an optional Seller Credential Program which will distinguish qualifying credentialed sellers to business buyers. 

Pros & Cons to B2B Selling

  • You will reach high volume buyers
  • You will offer products to business buyers
  • You can distinguish yourself with a richer seller profile that include B2B supplier credentials and certifications
  • The platform allows you to include additional documentation for products (CAD drawings, MSDS, user guides, etc.)
  • Only certain categories get referral fee discounts
  • Only certain price points receive FBA fee discounts
  • You must respond to business buyers asking for quotes
  • You must adhere to stricter performance metrics

How to Get Started with B2B Selling

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  1. New sellers can sign up for the professional selling plan via the Amazon Business Seller Program page
  2. Sellers need to get on the professional selling plan. Then, if eligible, existing sellers can activate by going to Settings > Account Info, click on Manage next to “Your Services” in left column, then select “Sell as an Amazon Business Seller“
  3. Existing retail sellers should understand that, in their B2B dealings, they will be expected to ramp up to the stricter standards characteristic of B2B transactions and the unique performance metrics relating to those standards

Amazon Business Buyers Program

The Amazon Business Sellers Program is the second of the two programs comprising the Amazon B2B Marketplace. Businesses interested in buying via Amazon Business must create an Amazon Business account. Any verifiable business, government, or NPO can sign up from the Amazon Business Buyer Program page.

Program benefits include:

  • Special business-only prices and specials
  • Free 2-day "Business Prime" shipping
  • Credentialed sellers
  • Quantity pricing
  • A selection of millions of general products and business-only products
  • Access to reports and analytics that track your organization's spending
  • Multiple marketplace offerings to choose from on a single product
Amazon B2B - Laptop with shopping cart to symbolize ecommerce sales.

Trendspotting: Amazon B2B is Ripe for Sellers

“2018 may be the year when small businesses reevaluate their position on Amazon,” Danziger wrote in closing her article in Forbes, “Rather than trying to hold back the tide, it may be time to catch the Amazon wave.”

As well, larger enterprises are now starting to see the cost-to-benefit advantages of selling B2B on Amazon Business to the platform’s million-plus business customers. According to Bill Briggs of Digital Commerce 360 regarding that burgeoning statistic, “the milestone might be less notable than the size and breadth of markets some of those companies signify.”

Whether seeking ecommerce solutions for small business or large, the Amazon B2B marketplace offers convenient and cost effective systems and should be considered by all who consider a robust B2B ecommerce platform essential to their selling or merchandise sourcing success.

Awesome Dynamic® provides consulting services to retail and business sellers on Amazon. Call us today for your free estimate: (800) 238-1811.