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The 3 Major Issues in B2B Payments

There are really three issues to be addressed in B2B Payments, with regulatory issues being one of them. Different jurisdictions and governments have different rules and ways to view the flow of a payment, and companies need to deal with that. That is clear.

However, there are also technology changes to be addressed. In the B2B space, data matters. That data lives in back office information systems – in ERP, purchase-to-pay systems, order-to-cash systems, electronic invoicing systems, and more. There are all kinds of data that requires a deep understanding of and access to it.

The third issue is the business model. The business models in B2C are really straightforward, well-known and well-understood by the consumer. But in B2B, different supply chains have different rules and different business models.

Re-engineering the Supply Chain with Innovation



The B2B space is on the precipice of a significant change. Both technology and innovation have always been applied to the top end of the supply chain – the tier one suppliers, and maybe some of the tier twos. The big buyer has put a lot of technology in place, and the banks have focused their attention on the top end of the supply chain.

Meanwhile, the tail end of the supply chain has been largely dismissed. That’s because the cost to deploy technology, and the ability of those companies to accept that technology, has not been readily available.

One of the biggest challenges in any supply chain is access to fast, good-priced, easy working capital.

Buyers will push more of their business deeper into the supply chain because of the quality of products or delivery, or the terms and conditions they get. The top end of the supply chain will be forced to perform better, or they’ll be dis-intermediated. At the same time, the back end will get advantages they never before had.



Source: PYMNTS.com

http://www.pymnts.com/news/2014/fixing-the-three-major-problems-in-b2b-payments/#.VFpBlPnF-So