What are the biggest challenges for B2B marketplaces to consider in 2024 - A 2023 Recap

In 2024, B2B marketplaces face a transformative landscape, demanding evolution to stay competitive. Deciding their marketplace model is their key essential first step, but what comes later? Once you’ve decided the marketplace model is right for your business, what else should be on your radar? The specific challenges of your vertical, geography and market opportunity should always be taken into consideration, but additionally, you should be cognisant of the following challenges:

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How to select the right trading model for your business

One of the most significant decisions facing businesses when looking to set up a digital platform is what trading model to use in order underpin the whole thing. Although at first it can seem a complex decision, with businesses needing to balance an almost impossible array of competing factors, there are some questions businesses can ask themselves in order to streamline the process and guide them to the correct choice.

Firstly, businesses must consider the nature of the product they are trying to sell. If it is a divisible product with a fixed supply, then a capacity auction model would be the appropriate selection in order to ensure market clearance and an equitable price discovery process. If the product has many complex attributes that can determine price, a structured negotiation model might be more appropriate to ensure all attributes are accounted for. Finally, if demand significantly outstrips supply for the product, a sealed bid model might work best, to make the most of market conditions. The final consideration would be pricing exchanges—is it likely to stay a fixed price or does the price vary regularly or even daily? This might push some marketplaces toward a dynamic pricing model instead of a simple fixed price marketplace model.

In addition, whilst launching with a simple English forward or fixed price marketplace model might be great for your business in 2024, but will it continue to be? Even within a single business type, some articles might fetch a better market price or support ongoing market uncertainty in a different trading model, liked sealed tender, or negotiations. Partnering with a tech provider that can suggest the optimised trading model for your marketplace as it grows and evolves, based on data science, will be a key future proof strategy.

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How to ask the right questions during a selection process to trust the systems you? select

Once a trading model for the platform is selected it is then essential that businesses are asking potential vendors the right questions to ensure their needs are effectively met. First amongst these considerations should be can the vendor adequately support the necessary transaction volume for your business, especially at peak times. If your business has latency requirements or minimum thresholds for number of listings at any one time it is vital that your chosen vendor has capacity to deal with this. However, not only must they be able to satisfy your requirements in the present, it is also important to keep one eye on the future and assess whether they have head room to support your businesses as it scales and grows moving forward.

Secondly, it is important to ensure that the vendor can necessarily capture a product’s complex attributes. Insufficiently conveying a product’s specifications lead to poor customer user experience, and interfaces that are able to both capture complex attributes and offer a smooth buyer/seller opportunity should be prioritised to ensure maximum revenue.  can have a knock-on effect on price and cause your business to miss out on value. If a vendor’s platform does not have enough flexibility to accurately capture your product e, then they are not appropriate partners for your business.

Finally, any prospective technology provider must be able to seamlessly fit into your overarching technology ecosystem and handle the necessary integrations. Every business has its own idiosyncratic systems that are vital to its operational efficiency. Any technology provider must have the ability to integrate smoothly with these systems in a way that optimises processes and avoids operational breakdown.

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How to create a business case/P&L that supports both initial investment and long-term growth and profitability?

As the B2B enterprise software buying landscape changes, as many as 15 individuals across the organisation may have an impact on the end decision. This may not just include whether the technology is fit for purpose from a CTO and tech team’s perspective, but may also likely require CFO or board signoff, in which case, a watertight business case will be required. Selecting a provider who has relevant benchmarks to set revenue expectation as well as create different models for different styles of trading or for different verticals allows flexibility in creating both a short and long term technical roadmap with a solid profitability model behind it.

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How to innovate—should you be a disruptor or market leader in your vertical or geography?

Being a market leader bears both benefits and risks, which is why partnering with an established technology partner leads to greater success for B2B marketplace launches. The onboarding and support required to shift current suppliers or buyers into a “new world” requires experienced hands, and accelerating the growth post launch are important considerations. Few individuals globally have experience in running B2B marketplaces, so being able to lean on a stable provider is a key element when a business determines they’re ready to lead as a disruptor.

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Conclusion

In a world where adaptability and efficiency are key drivers of success, auction and trading technology in B2B markets, driven by NovaFori’s industry-agnostic solution, has transformative potential. It enables B2B businesses to transcend traditional limitations, explore new trading models, and realise the full potential of their sales strategies at optimised prices. As B2B commerce continues to evolve, embracing this technology becomes a necessity for those looking to secure competitive differentiation in their markets.

Finding the right technology provider is crucial when embracing digital change. The choice of a technology provider can significantly impact the scalability and efficiency of your platform. NovaFori’s auction and marketplace experts blend analytical rigour, in-house frameworks and experience to design and model the right mix of trading events and transaction types to generate the optimal conditions for trade. Our technology supports multiple auction models that can be deployed either individually or in a hybrid set-up. Tailored to your needs, it facilitates price discovery across any use case.

At NovaFori, our mission is to help businesses and organisations - regardless of their size; unlock their full potential and feel empowered by the possibilities of their marketplace.

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Ready to evolve your B2B marketplace?

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