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Kriya Payments

From hailing London taxis to ordering an Uber: why an even bigger digital shift will happen in business e-commerce.

Anil Stocker
November 3, 2022
min read
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Uber transformed the taxi industry forever. The same digital change is now coming for business e-commerce.

CEO and Co-Founder Anil Stocker on digital revolution in B2B eCommerce

I’m old enough to remember the thought that went into taking a London black cab back in the 1990s. First you had to ensure you had taken out cash from a cash point, then you had to find a cab, while during the journey hoping that you had enough cash to cope with the meter creeping up in slow traffic. Often journeys were diverted to find a cash point to top up.

Taking a cab was thought of as something ad hoc and not regular. Most people either took public transport or their own cars, and only used cabs when they really needed to.

But Uber changed all that, suddenly you could tap into a large pool of new drivers from your phone and the car would come pick you up, using sat-nav to choose the route with the least traffic. Payments happened seamlessly behind the scenes with the app connected to your debit or credit account. Such was the convenience and price point that fewer people in cities owned cars as more began to just rely on Uber. Taking a taxi wasn’t just a nice add-on, it was an integrated feature of your life.

This shows the power of a platform working with financial enablers behind the scenes to remove friction in an age-old industry. It’s a trend that’s changed a number of consumer industries already when you think of retail, food delivery, fitness and entertainment.

It’s time for business trade to change

Now the same is happening in how businesses trade with each other. In these sectors, there are even more efficiency gains to be had.

Think back to what businesses contended with as recently as prior to the Covid pandemic. A food supplier to city venues would have to go and meet potential customers in person, one by one or at trade shows, to get to know and pitch them. They would have to email them with offers, call them, and hopefully land a purchase order.

Along with the order they would spend more time negotiating payment terms, hopefully securing some pre-payment up front, but often to stay competitive having to offer 30 or 60 day free credit terms. The supplier would then have to manage their own cash flow to prepare and ship the food products before receiving any money themselves.

After making delivery, they would ask for an emailed delivery note to prove the goods were accepted and of the right quality. They would reconcile this to the purchase order and then email over an invoice to start the credit term clock ticking. Inevitably the invoice would not be paid on the due date, leading to more calls and emails from the supplier to their end customers. Finally when the payment arrives they reconcile the purchase order with the invoice to see whether any net-offs or deductions were required for damaged or disputed goods, then add them all to their accounting system and close off the trade.

It’s easy to see the friction and time spent on non-core tasks in this lifecycle of an order. Ideally the food supplier should be focused on delivering the best quality of food - which is what most of them say in their marketing materials.

The possibilities of embedded finance

The good news is that software platforms, working with partners embedded onto them, are changing all of this. Now a food supplier can build their own website or work with a digital marketplace that connects them to thousands of buyers online immediately. Transactions can be matched on the basis of quality, price, delivery speed, or location; and suppliers can push deals directly to everyone at the same time.

Embedded finance partners work behind the scenes on verifying both suppliers and buyers, offering more convenient payment terms and third-party credit at the point of purchase. A supplier can opt to unlock all the money on delivery rather than waiting 30 to 60 days, and the buyers might have even longer to pay than before. Finally, all transactions can be immediately reconciled between the platform, the embedded finance partner and the accounting systems used by supplier and buyer. The velocity of transactions increases and efficiency across the whole supply chain is unlocked.

This is the Uber-moment when technology working behind the scenes adds value to businesses and gives them more time to focus on what they do best. Suddenly this becomes the main way that they conduct business and not just a little experiment of dabbling with e-commerce on the side.

E-commerce is the future

A recent McKinsey study shows that nearly two-thirds of B2B companies across industry sectors now offer eCommerce capabilities, and that more than one-third of buyers now say they are willing to spend $500,000 or more in a single transaction on digital channels. Two-thirds of B2B buyers are moving away from face-to-face meetings and manual tasks, reaching instead for digital or remote in-person engagement through video or online chat.

The digital transformation of B2B transactions has started, and those who suggest that dealing with business will return to exactly how things were done before, risk missing out on the immense benefits and efficiencies that have transformed to many other industries.

If you'd like to offer instant credit at checkout to your buyers, get in touch today. For more insights on the B2B eCommerce space follow our LinkedIn page.

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