Marketplaces have existed since people first gathered in one place to trade items, and that basic characteristic of marketplaces—having to be located in a specific physical space—has remained constant even as marketplaces have developed in complexity over the centuries.
But now that limitation is gone. Communication technology has freed marketplaces from their geographic restrictions, and enterprise marketplaces are increasingly moving online – with digital transformation becoming a crucial element of B2B as:
- 74% of B2B buyers prefer to buy online than from a sales rep
- 56% of B2B companies have customers that they can only profitably service online
- 60% of B2B buyers spend more when they interact with multiple channels
As a result, it is vital that B2B companies expand their geographical reach to tap into the global marketplace.
Perfect Channel’s technology provides a way to trade seamlessly throughout the world.
We have dedicated years to developing ways in which companies can find each other, transact and safely settle via an online marketplace. The advent of companies operating electronic payments via secure digital channels have further strengthened the position of such electronic marketplaces: instead of relying on a time consuming clearing and onboarding process, sellers are now able to outsource this to third party providers such as Optal and Payoneer. Risk of default is now minimised through an electronic escrow or similar.
Perfect Channel partners with the biggest payment providers to offer full onboarding & secure settlement:
Furthermore, the cost of structuring infrequent or even one off deals has fallen from the credit card sized fees charged just two years ago to today’s sub percentage point levels. It is now possible to create a client money account (CMA) electronically for a new buyer in a matter of hours anywhere in the world. This proves a veritable game changer for buyers who wish to transact directly with major suppliers.
A combination of containerization, electronic settlement/payment and a secure online marketplace will doubtless affect the role of brokers acting as principals on behalf of such smaller buyers. Changes seen with Alibaba and their marketplace for manufactured goods, will take hold in multiple commodity asset classes ranging from food, to minerals and even up the value chain towards raw materials. Perfect Channel is at the forefront of this marketplace revolution.
Next we illustrate the benefits of online B2B marketplaces, using a few client examples that have succeeded using Perfect Channel’s online marketplace tools and have expanded their geographical reach to tap into the global marketplace.
Global Dairy Trade
Global Dairy Trade (GDT), is owned by Fonterra Co-Operative Group but operates independently, provides a reliable and transparent means for buying and selling dairy commodity products from around the world. GDT has been holding twice-monthly trading events, but the co-op realised it could benefit from a reliable, transparent online sales channel that would enable 24/7/365 trading of dairy products.
GDT turned to Perfect Channel to provide enterprise-grade auction and trading technology and trading-mechanism design capability.
GDT moved from brokers working the phones, simple bi-lateral sales and a twice monthly trading event, to Perfect Channel’s 24/7 digital platform. It has seen wider product distribution and now has more than 650 approved buyers from more than 90 countries, with global sales of more than 1 million metric tonnes of dairy commodities.
LeasePlan (LP) is the world’s largest vehicle leasing company, managing more than 1.7 million vehicles in over 30 countries. LP’s vehicle fleet management ranges from the vehicle purchasing to the remarketing of vehicles at contract’s end, and every day up to a thousand vehicles are remarketed—with the majority of LP’s European vehicles being sold through online auction.
LP was clearly taking advantage of digitisation already, but its existing auction platform was nearing end-of-life status, and among many things, they wanted to enable cross-border trading, so they can achieve the highest price for their remarketed vehicles, regardless of which country a vehicle is located in.
LP turned to Perfect Channel to build their new auction platform using our Perfect Exchange technology, has moved from a direct selling model across 32 countries to a single entity using our digital platform and now thousands of traders can now bid concurrently, 24/7/365, on LP vehicles in 15 languages across more than 20 countries.
We are solving the problem of how best to grow your market: the number of participants, the depth in pricing and, ultimately, trade volumes. And we do this in a way that promotes the best outcomes for your business—by matching your supply to the market’s demand, efficiently and in real-time.
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