{"id":13826,"date":"2019-11-18T18:05:00","date_gmt":"2019-11-18T18:05:00","guid":{"rendered":"https:\/\/enable.local\/?p=13826"},"modified":"2026-03-03T12:33:42","modified_gmt":"2026-03-03T17:33:42","slug":"how-b2b-distributors-can-use-the-deal-economy-to-beat-amazon","status":"publish","type":"post","link":"https:\/\/www.enable.com\/resources\/articles\/how-b2b-distributors-can-use-the-deal-economy-to-beat-amazon\/","title":{"rendered":"How B2B Distributors Can Use the Deal Economy to Beat Amazon"},"content":{"rendered":"\n

The rise of Amazon Business has B2B distributors rattled. To compete, B2B wholesale distributors should focus on the things Amazon can\u2019t provide\u2014using the Deal Economy as fuel.<\/em>Amazon Business has posed a growing threat to B2B distributors since its launch in 2012. Gross merchandise volume at the \u2018Everything Store\u2019s\u2019 B2B division has increased 10x in two years<\/a>, from $1bn in 2016 to $10bn in 2018. Bank of America estimates it will further triple by 2023, to $33.7bn.With the rise of Amazon Business, B2B distributors have been feeling the squeeze in terms of lost business and downward pressure on prices. When MDM asked 167 distributors about their current concerns for its 2019 Outlook for Wholesale Distribution, \u2018Amazon\u2019 featured prominently among their responses. Others included price pressures and margin deterioration; both symptomatic of a market where Amazon\u2019s low-price ecommerce offering is eating into distributors\u2019 revenues and profits.<\/p>\n\n\n\n

A case of \u2018if you can\u2019t beat them, join them\u2019\u2014or is there a better way?<\/strong><\/p>\n\n\n\n

It\u2019s clear B2B distributors need to do something\u2014but what? Strategies that have been floated include \u2018beating\u2019 Amazon by setting up rival industry marketplaces<\/a>, and \u2018joining\u2019 them by using Amazon Business as a channel to market<\/a> for commodity products.These strategies assume that Amazon\u2019s model is the right one, and that to compete, B2B distributors should also move further into low-price e-commerce. But Amazon\u2019s model is only the right one for customers who know what they want to buy, and who want to pay as low a price as possible for it.That\u2019s OK for undifferentiated, commodity products. But as soon as the customer needs expert advice, or help selecting a specialist product, or contract support, or any of the other value-added services that B2B distributors excel at providing, Amazon can\u2019t help.That\u2019s why B2B distributors keen to beat Amazon should double down on the facets of their business that Amazon can\u2019t provide, and which its model explicitly precludes. Those fall into two broad categories: the customer proposition and the supplier proposition.<\/p>\n\n\n\n

The customer proposition: expert knowledge and tailored services<\/strong><\/p>\n\n\n\n

B2B distributors have built many solid customer relationships in which they are seen as expert and trusted partners. Those customers rely on their B2B distributor partner for three things that Amazon can\u2019t (and, more importantly, doesn\u2019t want to) provide:<\/p>\n\n\n\n