Is E-Commerce The New Standard For Wholesale Business Supply?

Supplies are an essential part of every businesses' operating expenses. Whether it’s office supplies, industrial motors, valves, fasteners, packaging materials or janitorial supplies — organizations have traditionally looked to distributors, often local, to meet their supply needs. Products and suppliers are typically selected based on several important considerations including customer service, supplier proximity, product assortment and availability, delivery time and pricing.

But today, things have changed. Welcome to the new online wholesale supply marketplace, and new players.  

Who hasn’t heard of Amazon.com? It’s a global Internet retail giant, and now there’s AmazonSupply, Amazon’s new business venture. Launched in 2012, this e-commerce site targets customers of the traditional wholesale distribution market. “We aim to offer Earth's largest selection of essential products for businesses, labs, workshops and factories,” the website extols. Google has entered the arena too, with Google Shopping for Suppliers.

Should businesses consider adding Amazon and Google to their list of suppliers for purchasing? Is this a reasonable alternative compared to existing suppliers? Perhaps.

A complete analysis of an organization’s cost management from the previous year should be step one in evaluating the viability of online supply services versus incumbent suppliers. In addition to the basics - product selection and pricing - additional considerations should include:

Customer service. Does the supplier provide assistance or expertise if there are questions about a particular purchase? How much assistance will you need? How will you learn about new products? What is the return policy?

Suppliers and product availability. Many companies prefer to use products they are familiar with. End-users typically develop an affinity for a particular manufacturer brand or product line. What products are available through a new supplier? Is the selection limited? Are there restrictions for smaller purchases? Are the alternate products as good as or better than what is currently purchased?

Delivery time. Many companies have become accustomed to local delivery on a “next day” basis. What are your true delivery needs? Will new suppliers be able to meet this requirement without additional charges? 

Pricing. Overall, how does product pricing compare to current suppliers - for both contract and non-contract purchases?
       
Amazon and Google offer a great alternative for many supply areas, and for many businesses, but suitability will depend on the particular situation. Check service, pricing and delivery (as you normally would), and then confirm the information you may currently take for granted.

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