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Future-Proof Your Enterprise with E-Commerce

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2Future-Proof Your Enterprise with E-commerce

Introduction: The E-Commerce Opportunity for Manufacturers Forrester Research estimates that B2B e-commerce will surpass $1 trillion by the end of 2020 — outpacing B2C sales nearly four times over. This rapid growth ex-tends to the industrial manufacturing sector. For example, a 2015 UPS study1 found that 66 percent of buyers purchase online frequently versus 57 percent in 2013. Even among buyers whose top choice was an offl ine channel, the clear second choice in each case was online.

At the same time, end buyers are demanding direct access to manufacturer prod-ucts. In the study noted above, 64 percent of buyers stated that they already pur-chase direct-from-manufacturer, with 88 percent stating that they were “somewhat likely” or “very likely” to increase their direct-from-manufacturer spending. The growth of e-commerce is enabling this shift. In fact, a March 2016 webinar2 from Manufacturing.net titled “E-Commerce and Manufacturing in 2020: Will You Be

Ready,” noted a 2016 survey from Four51 that found “45 percent of manufacturers say e-commerce will be their top sales channel by 2020.”

UPS Industrial Dis-tribution marketing manager Simon

Bhadra called the Internet “the Great Equalizer and the Great Complicator” for mod-ern merchants, noting that “the distributors of industri-al products are not immune to the disruption.”

“The speed and scope in which industrial products buyers have adopted e-com-merce is without comparison,” Bhadra says. “Never before have they had so much information so quickly. E-commerce has caused customer behavior to change so rapidly that businesses are completely reevaluating their playbooks, sometimes throwing them out completely.”

Although the benefi t of e-commerce to the end-buyer is evident, manufacturers considering selling direct might be challenged by lack of IT expertise or infrastruc-ture required to launch an e-commerce platform. This paper will discuss common barriers and offer strategies to overcome them.

“The speed and scope in which

industrial products buyers have

adopted e-com-merce is without

comparison.”

3

Meeting Customer Expectations for a Seamless E-Commerce Experience What is motivating buyers to purchase online? According to Handshake CMO Mike Elmgreen in Manufacturing Business Technology, the answer is convenience. Elmgreen explains that buyers’ B2C shopping experiences using simple, fast mo-

bile and online purchasing options has transformed professional purchasing habits3. This is validated by the UPS Industrial Buyers study, in which

72 percent of industrial products buyers said they were either somewhat likely or very likely to shift spending to a supplier with

a more user-friendly website. Those in higher spending catego-ries and younger age demographics were more likely to buy direct, so it’s critical that the experience meet the expecta-tions of these buyers.

Manufacturers who might lack the expertise, staffi ng and budget to build a user-friendly e-commerce experience could

fi nd customer expectations daunting. However, relatively turnkey solutions are available to midsize companies. A trusted

partner, such as UPS, with its deep expertise in both e-commerce and the manufacturing sector can help companies achieve the seam-

less experience their customers expect. Solutions offered by UPS include:

Future-Proof Your Enterprise with E-commerce

72 percent of industrial

products buyers said they were either

somewhat likely or very likely to shift

spending to a supplier with a more

user-friendly website.

4Future-Proof Your Enterprise with E-commerce

UPS API Developer Toolkit Integrating and managing multiple platforms can be time-consuming and ineffective. The UPS Developer Kit helps manufacturers offer a smooth customer ex-perience that makes both selling and shipping easier.

UPS Application Programming Interfaces (APIs) are programming instructions and standards for accessing and integrating UPS functionality into e-commerce web-sites or enterprise applications. These complex technologies are designed to meet the needs of customers who require maximum flexibility during integration. The UPS API Toolkit can help manufacturers replace manual processes and free up time that might otherwise have been spent entering data. Possible business applications include:

Ordering: Improve accuracy of orders with address validation and time-in-transit APIs.

Shipping: Automate fulfillment and global shipping processes with shipping and pickup APIs.

Customer Service: Provide shipment visibility to customers, including accessible drop-off locations and easier returns.

UPS Ready® Program Providers The UPS Ready® program features a wide array of tech providers who offer solutions that can help companies tackle a multitude of business objectives, including better management of e-commerce storefronts, cross-platform tech integration and back-end tech integration to help improve real-time visibility into sales and inventory.

UPS Capital® Merchant Services UPS Capital® Merchant Services allows e-commerce sites to accept all major credit or debit cards, gift cards and e-checks, and includes a recurring billing system that can be set up for repeat customers. This service allows customers to pay using the method they prefer and manufacturers to get paid more quickly.

5Future-Proof Your Enterprise with E-commerce

About This Report The information in this report was researched and produced by Manufacturing.net in conjunction with UPS. Statistical data was researched and compiled by Advantage Business Media in July 2016.

About UPS UPS is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more effi ciently manage the world of business. Headquar-tered in Atlanta, UPS serves more than 220 countries and territories worldwide. Find UPS on the web at ups.com.

Summary Industry revenue forecasts, as well as studies of buyer behavior, clearly indicate that manufacturers should launch direct-to-end buyer e-commerce sites in order to remain competitive. Manufacturers investigating e-commerce can benefi t from the knowledge of experts such as UPS. With years of experience in the industrial man-ufacturing sector and its suite of approved UPS Ready® e-commerce partners, UPS can help manufacturers get to launch more quickly than building internal systems. As e-commerce demand continues to grow, UPS solutions help manufacturers to scale-up with demand, eliminate costs of maintaining proprietary systems and stay current with customer experience expectations beyond the initial launch.

1 UPS Industrial Buying Dynamics Study: Evolution of the Distributor Value Proposition.(June 2015)

2 “E-Commerce and Manufacturing in 2020: Will You Be Ready?,” http://webinar.manufacturing.net/four51_od_20160316_e-commerce_manufacturing_in_2020/ (March 2016)

3 Mike Elmgreen, “Mobile And Web B2B E-Commerce: A Competitive Edge For

Business,” http://ow.ly/a7pP30336gE (July 2016)