Business-to-business electronic commerce implies

that both the sellers and buyers are Business

Corporation
while business-to-consumer electronic commerce
implies that the buyers are individual consumers.
Business-to-business electronic commerce is
expected to grow to $1,330.9 billion by 2003 and
continue to be the major share of the EC market
The percentage of Internet based B2B EC
compared to total B2B commerce will expand
from 0.2 percent in 1997 to 2.1 percent in 2000
and 9.4 percent in 2003.
Computing electronics, utilities shopping and
warehousing, motor vehicles, paper and office
products food and agriculture are the leading item
in B2B EC

Business-to-business EC covers a broad spectrum
of applications that enable an enterprise or
business to from electronic relationships with their
distributors, resellers, suppliers, and other partners.
Handfield and Nichols(1999) suggest B2B
applications will offer enterprises access to the
following sorts of information

Product:
specifications ,prices, sales history
Customers:
sales history and forecasts(estimate or predict)
Supplier:
Product line and lead times ,sales terms and conditions
Product process:
capacities, commitments product plans
Transportations:
carriers, lead times, costs
Inventory :
inventory levels, carrying costs locations
Supply chain alliance:
key contacts, partners, roles and responsibilities,
schedules
Competitor:
benchmarking competitive product offerings , market
share
Sales and marketing:
Point of sale (POS) promotions
Supply chain process and performance:
Process descriptions, performance measures quality,
delivery time, customer satisfaction
In this section the business models of B2B are
described. The first three models are classified
depending upon who controls the market place .
The supplier, customer or intermediary.
Other important business models are virtual
corporation networking between headquarters and
subsidiaries and online services to business
Supplier Oriented Market Place.
Buyer Oriented Market Place.
Intermediary Oriented Market Place.

Supplier Oriented Market Place.
The common B2B model is the supplier oriented
market place.
Most of the manufacturer driven electronic stores
belong to this category.
In this method both individual customers and business
buyer use the same supplier provided marketplace
Buyer Oriented Market Place
Under the platform of supplier oriented marketplace
The buyers acquisition department has to manually
enter the order information into its own corporation
information system
Searching e-stores and e-malls to find and compare
suppliers and products can be very costly to companies
like GE
Who purchase thousands of items on the Internet.
Therefore such big buyers would prefer to open their
own market place which we call buyer-oriented market
place
Under this model, a buyer opens an electronic
market on its own server and invites potential
suppliers to bid on the announced RFQs are the
GE case illustrates.
This model offers a greater opportunity to
committed suppliers

Intermediary Oriented Marketplace:
The third business model is establishing and electronic
intermediary company, which runs a market place
where business buyers and sellers can meet.
This concept is similar to intermediary-based e-malls or
e-stores developed for B2C EC
Lead time: The time between the initiation
and completion of a production process
Product line:
a particular kind of product or merchandise;
"a nice line of shoes".
Subsidiaries: A company controlled by a
holding company.
RFQs requisitions for quotations
Demand the use or supply of,
Procurement: the obtaining of supplies
Procurement Management:
From the purchasing companys point view. B2B EC is
a medium of facilitating procurement management
such as
reduced purchase price
and reduced cycle time.
To implement B2B EC from the procurement
managements point view.
The buyer oriented marketplace or supplier oriented
market place can be used in this model where the
buyers announce the RFQs to potential suppliers for
competitive purchasing.
The concept of this model is described in a case study
with GE trade process market place and winning the
bid is the major concern
Just in time delivery:
The just In time(JIT) delivery of parts to
manufacturing buyers is crucial to realize JIT
manufacturing. Since online direct marketing
requires an internal JIT manufacturing system
the JIT delivery and advanced confirmation of
suppliers inventory are essential elements for
B2B EC.
Just in time delivery was not a critical issue in
B2B EC, so it was not handled as a central theme
of EC yet.
However as the importance of b2b grows, the
study on JIT delivery should be emphasized.
Many innovative B2B models were developed
over the years.
Before we present these topics it is
important to note that companies,
especially if they are large ones, can use
several models. IBM uses a supplier model for
its products a buyer model for procurement
and other models for various other activities.
Other models are:
B2b auctions
Managed Interactive bidding
B2b services
B2b auctions:
B2b auctions are growing very rapidly due to the
following benefits they provide:
Generating revenue
Increasing page views
Acquiring and retaining members

Generating revenue
New sales channel that supports existing online sales.
For example Weirton steel Corp doubled its customer
base when it started auctions
New venue for disposting of excess obselete, and
returned products quickly and easily
Increasing page view:
Auctions give sitesstickiness Auction users
spend more time on a site and generate more
page views than other users

Acquiring and retaining members:
All bidding transactions result in additional
registered members
Three types
Independent auctions
commodity auctions
private auctions by invitation only

Managed interactive bidding:
the bidding process conducting by large companies are
managed by companies themselves.
This model provide facilities to the bidders to take
participation in the bidding process of the large
companies throughout globe.
B2b services:
B2b service model of business organization provides
after sale service to other business organization. Some
b2b services are provided by intermediary other by
specialist .
Examples of B2b services are
Commerce net (www.commerce.net) is a global non-
profit organization providing B2b service. Its target is to
promote and support emerging communities of
electronic commerce. Other sites that provide b2b
services are
The majority of B2B transactions are conducted
by EDI(extranets)
We will discuss traditional EDI and Internet based
EDI separately
Traditional EDI:
EDI has been around for almost 30 years in the non-
internet environment.
It standardizes the process of trading and tracking
routine business documents. Such as
Purchase order
Invoice
Payments
Delivery schedules
Electronic data interchange translates these
documents into a globally understood
business language and transmit them
between trading partners using secure
telecommunication links.
The traditional EDI standards are EDI FACT
uses by USA for administration and
commerce trade

Significant initial investment is needed
Restructuring business processes is necessary
to fit EDI requirements
Long start-up time is needed
Use of expensive private VAN is necessary
High EDI operating cost is needed
There are multiple EDI standards
The system is complex to use
There is a need to use a converter to
translates business transactions to EDI
standards

The most feasible alternative for putting
Online B2B trading with in the reach of any
organization in Internet Based EDI.
There are several reasons for firms to create
EDI ability over the internet
The internet is publically accessible network
Provide access to a large number of trading
partners
Cut communication cost by 50%
Internet browser is user friendly and easy to
use