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How B2B Companies are Preparing For an Economic Downturn

September 29, 2022
 
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Disruptive supply chains, high inflation, and a looming recession are just some of the hurdles on the horizons of B2B companies. 

It’s clear that B2B businesses have a complex landscape to navigate. But companies that tune into their customers’ changing habits and respond to them will go on to be the market leaders of tomorrow. 

How will the economic downturn impact B2B companies?

In the current economic environment, inflation is the overarching factor affecting all economic actors, from consumers to workers to B2B companies. 

Rising prices hit B2B companies directly in the form of higher costs for raw materials and transportation. There will also be indirect effects for B2B companies as falling consumer demand impacts B2B customers, who in turn stop spending as much as they have done in the previous period.

With interest rates rising and high inflation predicted to be more than a short-term phenomenon, there’s potential for a cycle of low demand leading to low spending. During this time, buyers will be more particular about who they do business with.

How will B2B buying habits shift?

There are signs that inflation is beginning to peak in the US (if not elsewhere in the world – especially Europe. That could mean that the costs of raw materials start to drop, but as there is a lag between peak inflation and prices coming down for consumers, spending may continue to be sluggish.  

Whether inflation is set to come down or remain high for the foreseeable future, B2B companies should continue to invest in technology that will transform their business, helping them drive success long-term. 

Why B2B companies should continue to invest in eCommerce technology during an economic downturn

The habits of B2B customers are changing, with more and more B2B customer journeys happening online. Research for Gartner has found that the proliferation of online channels means B2B customers are now spending only 17 percent of their time meeting suppliers when considering a purchase.  

Influenced by the shopping habits of B2C customers and the growth of eCommerce in general, this trend is evident over the last few years and remains so this year despite the burgeoning recession.

More purchasing is happening online, so customers, whether B2B or B2C, feel increasingly comfortable doing part or all of their purchasing journey – from initial research to completing the purchase – in a digital environment. 

B2B companies that continue to invest in technology to boost their eCommerce capabilities will be the ones that emerge stronger. If you’re prepared to innovate online even in adverse economic conditions, you’ll be ready to take advantage of whatever phase of the eCommerce landscape comes after this challenging period. 

Aside from these general, long-term trends, there are more immediate reasons for B2B businesses to invest in eCommerce capability. 

  • Consumers – Consumer sentiment may be improving slightly, but consumers remain very concerned about high prices and their ability to make purchases. 
  • B2C brands – With the forward picture for consumers uncertain, the brands that serve them will be looking to make savings and efficiencies. 
  • B2B businesses – If your customers are B2C or DTC brands, providing them with a smooth, fast, and efficient purchasing process will distinguish you from the competition. 

If you can offer an all-in-one online portal that gives excellent customer service and re-ordering convenience, alongside a customer experience that’s comparable to the DTC digital experience, you’ll be able to retain customers and win new business in challenging times. 

If you can accelerate your digital transformation, making it quicker and easier to find answers to queries and make purchases with confidence, you’ll build trust in your brand, driving customer loyalty, and lifetime value. 

How Kibo eCommerce can help

Kibo Commerce allows you to deliver top-quality customer service to your B2B customers. Their headless APIs let you connect your existing systems to the platform, offering your customers unrivaled digital experiences to speed up and enhance the B2B buyer journey:

  • Search – Offer B2B customers the same level of search functionality that B2C customers expect, so your customers can find what they want more quickly, at the same time as boosting your searchandising capabilities.  
  • Orders – Allow your customers to quickly order and reorder by adding items to wishlists for future orders. 
  • Pricing – Set up account-level pricing so your customers feel valued and can take advantage of special discounts through your online portal.
  • Self-service tools – In addition to smooth ordering, checkout, and re-ordering capabilities, including customer support, you can also set up accounts so both you and your customers can create, request, and negotiate quotes. 

As Kibo Commerce is a unified platform, it enables multi-site management from one admin panel. That means if you also have a B2C operation you can manage that side of your online business from the same place. It’s another way to increase efficiencies and streamline your digital operation.

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