The pandemic has created myriad challenges for B2B firms. Those that relied on traditional buying and selling methods and manual back office operations have had to find ways to digitize their operations for everything from ordering and invoicing processes to how payments are collected.
Digitizing these processes and utilizing the right set of tools and technologies has become essential to keeping businesses afloat and helping them successfully compete in the expanding global B2B economy. This means that firms must rethink the various points of the O2C cycle with a critical eye, including how they connect with other businesses in the first place, Nick Shaffer, CEO for online B2B marketplace BoxFox, said in a recent PYMNTS interview.
Ensuring that B2B payments are made swiftly and securely is likely to become more important for businesses as they digitize their operations and diversify how they buy and sell. This is especially the case as more B2B transactions — both domestic and global — are conducted digitally.
“The time associated with traditional payments, I think, is going to drastically decrease,” Shaffer said. “I think people in today’s day and age want convenience and they want things instantly, and the first company that is going to be able to deliver that with payments specifically is going to have a very lucrative advantage.”
Taking A Global Approach To O2C
Keeping up with the ever-changing dynamics of today’s business environment hinges on businesses’ abilities to transact quickly and seamlessly. Slow or unwieldy payments experiences can jeopardize sales. Companies must therefore carefully balance payments speed with payments security — a practice that is all the more important as firms seek to move their inventory with ease in a virtual environment.
BoxFox is seeking to resolve this challenge with its platform. The marketplace holds payments in escrow for a three-day review period to make sure buyers are fully satisfied with their goods, Shaffer explained. Once the goods have been received and accepted by the buyer, the marketplace works with a third-party payment provider to ensure that funds are swiftly released to sellers, fostering trust between both parties.
An equally important aspect of building a competitive business is being able to send cross-border payments just as swiftly as domestic ones. Tapping a global third-party payment provider could help firms effectively circumvent this challenge. BoxFox, which is currently a U.S.-only company, plans to take this approach in the future, Shaffer said.
“I think the bigger holdup would probably be the shipping, customs and everything like that because we have [that] review period,” he said. “Internationally, I think that would cause just a little bit more of a challenge that we would want to wait a little bit on for that.”
Mastering The Technology
Being able to send and receive payments in an efficient manner is only step one. Other aspects of the O2C process must also be innovated to match the seamlessness of the payments experience. B2B companies — especially those operating on a global scale — must therefore approach their O2C processes holistically and with an eye toward the technologies and tools that can better connect all the disparate parts of these processes. That area still has significant potential for technological disruption, according to Shaffer.
“The integration of technology into B2B systems, for example, processing orders, shipping times, payments clearing … those are systems [where] we are going to see a lot of integration, a lot of technological infusion in the next few years,” he said. “That is just going to take B2B to the next level.”
Businesses that are quick to embrace new technologies that can help them remove redundancies in their O2C processes are likelier to be more adept at adjusting to the changing dynamics brought on by the pandemic and will be better positioned to keep up with competition as B2B commerce goes global and becomes as interconnected as the B2C world.