What is Amazon Business: everything you need to know about selling B2B on Amazon

The first platform that many consumers choose for buying goods is Amazon

What if you could harness Amazon’s reputation and knowledge for your own direct sales to other businesses? Well, you can because Amazon has a B2B (Business to Business) arm called Amazon Business, and it’s one of the fastest growing platforms within this sector in the world.

Amazon Business offers the same smooth service as its consumer arm, and it is part of the rapidly expanding and trusted Amazon empire. The results speak for themselves too, in 2019 Amazon Business grew 1.6 times faster than Amazon – that’s a lot of happy B2B customers.

In the same year, the global B2B eCommerce market was valued at over $12.2 trillion. Contrastingly, the B2C market was valued at $2 trillion – so you don’t need to be a maths genius to work out where the new growth and opportunities are in the market.

In this article, Amazon Expert James Pitts-Drake (CEO and founder of Optimizon) sets out everything you need to know about getting in on the act before your competitors and selling B2B via Amazon Business.

How does Amazon Business work?

Amazon Business is a B2B version of Amazon’s consumer arm. But instead of a business selling to the public, it’s geared towards businesses selling to other businesses. Think of it as the standard Amazon website but a business-friendly version.

When you become an Amazon B2B seller there are a number of benefits. The free ‘storefront’ just like your own hosted eCommerce website strengthens your brand, plus you get paid on time!

Other benefits include selling to both business and consumers from the same place, if that suits you, but with the flexibility to provide different products (and prices) and credit options. There are also special targeted advertising campaigns and attractive shipping options for your business customers.

If you want to widen your market and stay ahead of the competition, then joining Amazon Business makes sense. The company has invested heavily in European teams to support you and your business growth.

Grow your B2B and boost market share

Who doesn’t want to increase their sales and market share? Bulk selling is one obvious way to increase your turnover, and Amazon Business gives you access to a vast platform selling in bulk to other businesses.

Thanks to the huge volume of traffic, you will also enjoy a higher visibility of your business offers. This kind of selling profile can take years to build on your own, but thanks to the potential numbers of buyers visiting Amazon Business you can link into the platform’s steady stream of customers instantly.

Making B2B easy with Amazon Business

All businesses need good credit, and this is something that Amazon Business has put at the forefront of benefits for both you, the seller, and your business customers. One of the friendly features of this platform is that a business can purchase items from you in bulk, or small amounts, and obtain 30 days credit. However, you as the seller are paid immediately.

Buyers don’t need to set up an account with you either before they buy. As long as your potential customers have an Amazon Business account they can purchase your goods straight away.

Keeping track of sales has been simplified too, both for you and your customer. Each business customer can assign ‘users’ who are allowed to access the account and purchase supplies on Amazon Business on behalf of their employers (i.e. your customer). Instead of having multiple people making multiple purchases to keep track of, it’s all simplified into one place.

This ability to have one central point for business purchases, with automatic business credit control and VAT invoicing, makes it smoother for accounts departments to budget, make purchase approvals, manage payments and track shipping. Your B2B customers also have access to real-time reporting.

Like the consumer arm of Amazon, your customers will enjoy speedy delivery times and easy quick refunds. Then there’s the host of exclusive Amazon-only business discounts from trusted suppliers (which could be you) to attract even more sales.

Unlock more benefits

Who doesn’t love Amazon Prime - with free delivery and the top TV offerings. Amazon Business has its own version (no prizes for guessing the name) called Business Prime. This upgrade unlocks additional business benefits including same day delivery times – but, sorry, there’s no Amazon Video!

Business Prime includes:

• Rapid delivery times: Same Day, One or Two-day shipping and options to select consolidated shipping.
• Access to exclusive prime day deals.
• Detailed analysis of spending trends to help you plan and grow market share.
• Extended terms for Pay by Invoice (extended payment terms to 45 or 60 days).
• Guided buying (you can mark certain suppliers and products as preferred).
• Amazon Business American Express card (no annual fee credit card).

When it comes to payments and credit control, there’s another option which is completely free for account holders that qualify. The new payment method ‘Pay by Invoice’ provides billing invoices for orders. The business then gets access to terms such as Net30, which gives them longer to pay their Invoices (30 days after the bill date in case of Net30).

The package of multiple benefits, and attractive terms, means that every day traders are joining Amazon Business to offer all kinds of business supplies.

See the future before your competitors

Amazon Business was launched in 2017 in the UK, two years later than in the US. It’s only just beginning to reach the awareness of many businesses in the UK, but it’s growing fast. In early 2020 this arm of Amazon was cited as the fastest expanding part of the brand.

So, although Amazon Business is already established, there’s still room for growth and joining now means you will be ahead of the curve. Getting your business established on the platform means you will have a stronger foothold (and more reviews) than competitors.

Benefits for Amazon Business sellers

The first obvious benefit is the huge B2B access via Amazon’s large marketplace. But there’s another plus that you may not have considered – accounting.

Amazon Business takes the stress out of VAT and credit control with its automated VAT invoicing and VAT-exclusive prices display. As a seller, provided you meet the criteria, you can enrol in Amazon’s VAT Calculation Service for free – saving you time and hassle.

What’s more, displaying VAT exclusive prices to your Amazon Business customers can lead to higher B2B sales. Amazon’s VAT Calculation Service then provides sellers with a tax calculation, VAT invoicing and transactional tax calculation reporting functionality.

Amazon Business understands the importance of cash flow

With all sales comes payments, but one of the key problems for all businesses no matter how big or small is cash flow. With Amazon Business, the credit control function means you don’t have to waste time chasing invoices or waiting to be paid – Amazon Business pays you instantly.

So, no more wasting time (and money) chasing customers for payments by sending out reminders and generating unwanted extra paperwork and emails. They buy, you get paid.

Shipping Flexibility

One thing nobody can argue with is that Amazon knows all about shipping. However, when it comes to businesses, they know that one shipping option won’t fit all, so there are various options for B2B delivery which include:

• Storing your products at Amazon warehouses and then having them shipped by Amazon once the goods are ordered and paid for. This is ‘Fulfilment by Amazon’ (FBA) and is the best way to achieve super speedy delivery times.
• Holding your own products and shipping them to the customer. This is ‘Fulfilled by Merchant’ (FBM).
• You can also sell your products to Amazon at wholesale price via the Vendor Program. Amazon then holds them in an Amazon warehouse and ships them, (returning any unsold goods to you at a later date).

Key Takeaways...

Amazon Business is an established platform, but it’s growing rapidly in the UK. It has a proven track record within the B2B marketplace.

You can create a ‘storefront’ that fits your business model, with credit that won’t break your bank. Instead money from your sales will hit your account immediately.

You have the potential to reach millions of B2B customers around the globe and expand and grow from your current trading position. Amazon’s familiar interface allows your business to benefit from higher visibility of business offers and lower fees on high volume transactions.

As a B2B seller, you have multiple benefits including exclusive pricing options for customers, tax, invoicing and credit control features plus analytics. You won’t waste time chasing invoices, putting together quotes and creating VAT invoices.

Amazon provides a constant and growing stream of traffic from buyers who have authority to purchase. And you can tempt these buyers with a host of fantastic eCommerce features via Amazon Business, without the associated costs of running your own B2B website.

The current trend suggests that the platform will continue to see growth in the UK and other regions - particularly as remote working becomes the new normal. By making yourself visible on the Amazon Business platform now, you’ll be riding the crest of the wave, most importantly ahead of your competitors.

If you would like to know more about how you can join Amazon Business, please get in touch with the Optimizon team. Our experts will be happy to help and answer any specific queries you might have about the best way to make this exciting opportunity work for your brand.