New Online Markets Let You Integrate One-off Purchases Into Your Payments Process

Using contracts locks in prices, payment terms, and assures that you buy from known suppliers who commit to providing an established level of quality and reliability. Besides the direct bottom-line benefits of a negotiated price, contracts simplify and streamline the work of the payments department.

You can’t sign contracts for everything you need, though, and spot buys can be as much as 20 percent of a typical company’s spending. Plus, forcing buyers to purchase through contracts can also mean missing out on better values. Now, online marketplaces focused on the B2B market enable companies to make one-off purchases that integrate with their standard approvals and payments process—meaning companies can get the benefit of the best terms available without any loss of oversight.

Markets Built into E-Procurement

Some e-procurement vendors are building support for these one-off purchases into their products. SAP Ariba’s B2B marketplace recently announced an off-contract service called Spot Buy. If a buyer needs a product that’s not available in their company’s standard agreements, they can search the Spot Buy catalog for a vendor. Ariba lets companies define business rules and a workflow for spot buy purchases to ensure they conform to policies. Companies that use Ariba get transaction details that help them monitor and manage these purchases and incorporate them into analytics.

Amazon for B2B

Amazon’s appeal to consumers is uncontested; your employees are likely spending some of their time at the office on that site shopping for themselves. Now, Amazon’s B2B marketplace may make it equally popular as a destination for business shoppers. The Amazon Business marketplace has more than 30,000 sellers. Shopping there gives business customers the ability to purchase from approved vendors with agreed-upon contract terms, or to find a better price from an alternate seller.

The Amazon Business site includes products that can’t be sold to consumers, but that’s not the only feature that supports B2B buyers. Some items may have business-only prices or quantity discounts for large business purchases. Business accounts let multiple individual buyers make purchases on the same account, with reports available to help monitor spending. When customers are logged in, the displayed pricing will reflect the customer’s agreements with that vendor; but as on the consumer version of Amazon, alternate sellers will also be listed, allowing employees to make purchases on the best terms available.

Amazon Business supports oversight of these purchases in multiple ways. Users can direct orders to be routed for approval rather than immediately placing them, and orders that exceed a threshold amount can be automatically routed for approval. Companies can add purchase order numbers to support their tracking, and purchases from multiple vendors can be combined onto a single electronic invoice and paid through a single payment to Amazon. More than 30 procurement applications allow purchasing through Amazon Business.

Flexibility to Meet Changing Needs Without Losing Control

Companies need to find the balance between flexibility and control. While purchasing and payments departments like contracts, by definition they lock you into a particular pattern of spending and purchasing.

The new features of online B2B marketplaces help companies retain control without restricting employees’ ability to find the most appropriate products and solutions. Forrester expects the online B2B market to reach more than $1 trillion per year by 2020. With B2B sites like Amazon making online shopping as easy for business customers as it is for consumers, employees will expect to be able to use them for business purchases. Companies that not only allow this but also encourage it will reduce the time and effort needed to approve one-off purchases, gain data needed for oversight, and possibly even beat the costs locked into contracts.