The global e-commerce fulfillment services market is expected to reach $113.59 billion by 2027. The proliferation of e-commerce platforms and the rising number of online buyers, especially in emerging economies, are anticipated to fuel the need for B2C and B2B e-commerce order fulfillment.
Unfortunately, it is not always easy to identify the right 3PL provider to help you get your products and services to the target market on time and in the most efficient way. Whether you are fulfilling orders for single-end customers or retail stores, understanding B2C vs. B2B order fulfillment will point you to the right third-party logistics provider to partner with.
With this in mind, let’s take a look at some of the critical differences between B2B and B2C order fulfillment.
What Is B2B E-Commerce Order Fulfillment?
B2B e-commerce order fulfillment involves a direct shipment of products to a business or a retailer. These orders are typically larger and may require businesses to have enough inventories to sell them. Additionally, businesses utilizing B2B e-commerce order fulfillment may be required to meet some compliance requirements like tax rules, product restrictions, specific invoicing, SKU codes, and more.
These orders may also cost more and require longer delivery lead times. Additionally, when utilizing B2B fulfillment, you need to acquaint yourself with all the essential carrier information needed to ship products to distant locations. These requirements include sea freight or air freight and international trade barriers like tariffs, taxes, and subsidies.
What Is B2C E-Commerce Order Fulfillment?
In B2C e-commerce order fulfillment, orders are directly shipped to end customers. This method involves fulfilling one-off purchases from individual end-users. B2C is typically simpler, less costly, and has fewer compliance requirements than B2B.
It has set pricing that applies to all customers except during seasonal or promotional activities. B2C fulfillment orders also feature more streamlined payment methods thanks to user-friendly online checkout processes designed for payment transactions.
Main Differences Between B2C and B2B Fulfillment
Although both B2C and B2B fulfillment utilize the same steps of the retail fulfillment process, each has its unique aspects.
Order and unit volume
B2B fulfillment orders are typically larger in terms of quantity while lower in volume. Although B2B customers tend to order only a few times per year, their purchase quantity is usually much larger. B2C orders are typically smaller in terms of quantity but with a higher volume. Although they may have fewer items in an order, B2C customers are more likely to make more orders in a year, delivered directly to their residential locations.
Shipping methods
Because of their larger and bulkier nature, B2B shipping and logistics tend to be more complex. B2B fulfillment orders are typically shipped via freight and palletized due to the sheer number involved, unlike B2C orders delivered via common couriers such as UPS and FedEx. However, should it be determined that a B2B order is too small for oversized freight, they can be packed in boxes and delivered via a parcel.
Regulations
B2B fulfillment must comply with lengthy supply chain regulations to operate their processes. Specifically, hazardous materials, heavy items, electronic data interchange, and international shipping require fulfillment services to comply with set regulations. Although B2C order fulfillment has regulations, they are not as complicated as those of B2B fulfillment.
Total fulfillment cost
Since B2B fulfillments handle larger and bulkier shipments, orders tend to be more costly and valuable and may need specialized loading and unloading processes. In a nutshell, fulfilling large-scale B2B fulfillment orders takes more person-hours and more equipment than single B2C orders, making them more expensive solutions for companies.
Fulfillment speed
B2C fulfillment is typically more time conscious, and if you choose to have your B2C orders fulfilled by a 3PL, they should focus on aiding fast and reliable delivery. Customers expect their orders to be delivered to them fast and efficiently, as fast delivery time is among the top determinants of a shopper’s brand impression. Failure to deliver on time may lead to injured brand reputations, refund losses, and lost customers.
Since B2B transactions involve larger shipments, the shipping process takes a longer time. Some big-box retailers typically have routing guides that fulfillment services must follow. These routing guides provide insight into when and how products will be shipped and received.
Payments
In B2B fulfillment, payments for orders typically occur over an agreed period and through standard payment methods, including credit and purchase orders. However, B2C orders are paid immediately when purchasing via cash, check, or credit card.
Returns
B2C transactions have clear return, exchange, and refund policies. However, the return and exchange of the product in B2B fulfillment are more complicated due to the larger order size, nature of the contract, and negotiated obligations.
Sales assistance
B2B order fulfillments feature more service and support with a dedicated account manager or sales coordinator who helps facilitate the B2B exchange of goods. B2C typically provides little or no sales assistance because customers directly place orders via an e-commerce platform.
Sales process
With B2B, the sales process takes a long time due to the scale and nature of the buying process. Typically the processes go through multiple stages, including identifying products, requests for quotes, departmental approval, and negotiations. For B2C, the customer shops around in a few locations, places an order, and requests it to be shipped immediately.
Smart Warehousing Does Things the Smart Way
In today's highly competitive business environment, partnering with the right order fulfillment provider guarantees you are one step ahead of the competition. Smart Warehousing boasts decades of industry expertise, premium technology, and automation to ensure the timely fulfillment of all orders — from retail to e-commerce, frozen to ambient.
By embracing smart fulfillment, we strive to offer consistent communication, excellent customer service, unbeatable technology, and exceptional solutions that provide you the peace of mind to focus on meeting and exceeding your consumers’ demands.
Whether your current 3PL is unable to fulfill both B2B and B2C orders or you’re looking to venture into fulfillment for the very first time, we’re excited to talk. Contact us today to learn more.