B2C Developments Fuel B2B Innovation

The payment trends making waves in the business-to-consumer (B2C) space have not gone unnoticed by B2B firms.

B2B companies are likewise taking to digital channels to manage numerous business functions, including establishing buyer or vendor relationships or handling critical payment functions, according to “Optimizing B2B Payments,” a PYMNTS and American Express collaboration.

Get the report: Optimizing B2B Payments

Driving this B2B shift is the experience of seamless B2C payment processes in B2B professionals’ personal lives. Many employees are now expecting to see the same seamless, digital payment experiences that characterize their B2C transactions when they make B2B purchases at their firms — and many are more than happy to switch to new vendors if these expectations are not met.

The Draw of Consumer-Like Payments Experiences

For example, in the beauty and wellness industry, the digital transformation that began with efforts to address health and safety concerns has now evolved into easier and more convenient options for customers.

Read more: Beauty, Wellness Merchants Get Smart Digital Payments Makeover

The draw of consumer-like payments experiences for many companies appears to be the overall speed, convenience and personalization they grant shoppers. More B2B buyers are expecting to be able to browse through vendors’ products online, checking product reviews and other details before completing transactions.

Companies have been moving steadily to nudge their B2B payment and sales processes to be more in line with B2C experiences for several years, but some are still facing challenges in doing so.

Transitioning to digital-first payment processes is not automatic, however. Firms must confront several hurdles, including challenges with legacy infrastructure and a lack of automation in their accounts receivable (AR) departments.

The issue is especially prevalent among small- to medium-sized businesses (SMBs) in the B2B space, as many have less cash and fewer employees to spare as they ponder taking more of their payment processes digital. It will thus be necessary for these SMBs to determine which technologies and processes represent worthwhile investments in the years ahead.

Crossing the B2C-to-B2B Gap

Implementing automation, flexible payment tools and other key technologies into these processes is one way these firms may be able to cross that B2C-to-B2B gap. For example, integrating automation into payment processes can allow collections to be managed instantly.

B2B firms are also beginning to comprehend the importance of accepting credit card payments, which can help them flexibly adjust to the payment challenges they have encountered recently. Some B2B businesses have held out on accepting credit cards in an attempt to avoid the modest fees they charge, but many are beginning to change their tune because doing so could cost them sales in the era of eCommerce.

Credit card acceptance can allow buyers to access one of their preferred payment methods as well as help their businesses expand. Sellers, on the other hand, get a better handle on their cash flows by gaining faster access to their payments.

Cutting down on payments time frames can help inch small buyers’ B2B experiences closer to the B2C-like interactions many are now expecting, allowing them to better compete. Failing to do so raises the potential for these companies to fall far behind other entities, especially as digital becomes the norm not only for consumer transactions but also for all types of commerce.