The coronavirus pandemic shook the global economy, but at the same time it caused changes in the market within just a few months that had previously taken many companies even several years. The pace of digitalisation of the B2B market is accelerating significantly, and many companies are also making or planning major changes to their supply chains.

According to experts at merXu, a marketplace e-commerce platform for B2B trade in Central and Eastern Europe, these phenomena will intensify in the coming period and drive business development in our region.

An avalanche of digitalisation in B2B

An avalanche of digitalisation in B2B

Since the outbreak of the pandemic, entrepreneurs have been increasingly focusing on digitalising their processes, and on the other hand they expect the same from their contractors. This is clearly shown, among other things, by the results of a survey conducted a few months ago among procurement specialists at companies from Europe, North America and Australia by the American research institute Hanover Research for the company PROS. Respondents indicated that the level of digitalisation of purchasing in their companies rose from 29% to 37% during just the first wave of the pandemic, and they predicted that it would soon reach 40%.

As many as 66% of buyers also stated that most of their suppliers were not sufficiently digitalised and well prepared for the new business conditions. They questioned, among other things, the speed and effectiveness of responding to requests for quotations (44%), unstable price levels (31%) and insufficient availability of information on inventory levels (29%). As a result, during the first wave of the pandemic, only 30% of surveyed companies made no changes to their supplier structure, 51% made some changes, and 19% of companies decided on very significant reshuffling in this area. Decisions to start working with other contractors were influenced not only by competitive prices (40% of responses) and the availability of products and materials (39%), but also by a better purchasing experience (35%).

- This year has shown that there is no turning back from digitalisation. This is also clearly visible in the case of Polish companies. As recently as the beginning of 2020, many entrepreneurs were not planning to move even part of their sales and purchasing online. They often did not have the right knowledge and resources, nor concrete ideas for development in this direction. Today, just a few months later, the situation has changed 180 degrees and most entrepreneurs are fully aware that doing business via the online channel is no longer the future but the present, and that they can gain significantly from it - comments Piotr Nowjalis, CFO of merXu. - Many companies have managed over the past months to increase the level of digitalisation of their purchasing and sales, but 2021 will undoubtedly be a time of true flourishing in this area - he adds.

A turn towards local contractors

A turn towards local contractors

Pandemic and the B2B market in 2020 — conclusions and trends

Another phenomenon accelerated by the outbreak of the COVID-19 pandemic is changes in the supply chain structure of many companies from Poland and Europe. Temporary shutdowns of production in Asian factories and border closures were felt by practically all entities that have foreign suppliers. As a result, an increasing number of companies began looking for partners located in the region.

- For companies whose operations were largely based on supplies from China or other Asian countries, the crisis related to the pandemic turned out to be very painful. Stoppages in the global flow of goods negatively affected their operational activity and financial liquidity. Meanwhile, companies whose supply chains are more local were able to operate much more stably and felt less impact, for example, from border closures – comments Piotr Nowjalis. - The situation we faced this year has caused the trend towards shortening supply chains to intensify significantly. In this context, the coronavirus paradoxically creates an opportunity for the economic development of our region, because more and more companies have begun to look with interest at suppliers from this part of Europe. And it must be emphasised that our region, and in particular our country, has enormous potential and is extremely competitive in terms of price and quality, both on a European and global scale – he adds.

An opportunity for business development in the CEE region

An opportunity for business development in the CEE region

Polish companies are becoming bolder in approaching the topic of digitalisation. For buyers, it creates the opportunity to optimise purchasing thanks to access to a greater number of potential partners and to compare their offers in terms of price, quality and other criteria. Sellers, in turn, see an opportunity to expand their group of contractors, both domestically and abroad. For them, however, moving part of their operations online involves higher investment outlays, including building an online store, spending on promotion and marketing, and hiring a sales and customer service team. Most often, only large companies can afford this type of expenditure. This does not mean, however, that small and medium-sized enterprises cannot afford to enter the online channel.

- We are aware that entrepreneurs encounter many barriers when they want to take their business online and start selling abroad. This is not only about the financial aspect, but also concerns such as unfamiliarity with the language, logistics or payments. With a view to removing these barriers, we created the merXu.com platform, the first marketplace dedicated to B2B trade in Central and Eastern Europe – comments Przemysław Budkowski, CEO of merXu. – We give entrepreneurs a ready-made tool that enables them to enter the digital world quickly. For Polish manufacturing companies and distributors, this is a huge opportunity to increase export activity thanks to access to potential contractors also from the Czech Republic, Slovakia, Estonia and Lithuania. For entrepreneurs looking for suppliers, merXu enables an impartial, immediate verification of the terms offered by their current partners, finding the best possible offers among hundreds of thousands of products, conducting negotiations online and concluding transactions. Buyers therefore have a full package of benefits in one place – price, product availability and the credibility of partners – summarises Przemysław Budkowski.

Summary

The pandemic accelerated the digitalisation of the B2B market and changes in supply chains. Hanover Research for PROS shows that the digitalisation of purchasing rose from 29% to 37% already in the first wave of the pandemic, and 66% of buyers believed that their suppliers were not ready for it. The trend towards shortening supply chains is also growing – many companies from Poland and Europe are looking for local contractors, which creates an opportunity for the CEE region.

Experts at merXu indicate that 2021 will be a time of flourishing B2B e-commerce, and tools such as marketplace platforms can help small and medium-sized companies expand abroad without large investments.