How Business-to- Business Internet Transactions and Relationships Change Business.

Created By: Brandon D. Smith Management Information Systems Professor Sistrunk MWF 11:00

Table of Contents 1st Fact 1st Fact slide 3 Benefits of B2B Internet Transactions Benefits of B2B Internet Transactions slide 5 2nd Fact 2nd Fact slide 6 Examples of B2B Transactions via Internet Examples of B2B Transactions via Internet Slide 7

Table of Contents cont. Interview with Stephen D. Smith Interview with Stephen D. Smith Slide 26 3rd Fact 3rd Fact Slide 30 The future of Internet in dealings with businesses. The future of Internet in dealings with businesses. Slide 31

U.S. Internet Revenue Totaled $301 Billion in 1998 (Source Univ. of Texas Study/Washington Post 6/10/99)

Business to Business Internet related transactions are focused on selling within a business contract or business partner relationship, which entails delivering agreed upon products and prices to each buyer within specified buying companies. Because users and their requirements are already known, the emphasis is on getting the businesses to manage contracts, users, orders and more; and to allow the system to tailor customer interactions based on contractual or other business relationship terms.

Benefits of B2B Internet Transactions  Cost reduction;  Increased transaction volume;  Increased transaction revenue;  Opportunities for new products and services  Opportunities for increasing revenues through cross selling  Commercial customer retention

Electronic Commerce brings many benefits and in a recent study of U.S. companies offering product purchases over the Internet - 63% of those interviewed reported cost savings, 31% saw revenue increases, and 47% noted a cycle time reduction in delivery of goods or services. It is clear that Business to Business electronic commerce represents by far the most compelling business case for virtual trading and will dominate the business opportunity for banks. Electronic Commerce brings many benefits and in a recent study of U.S. companies offering product purchases over the Internet - 63% of those interviewed reported cost savings, 31% saw revenue increases, and 47% noted a cycle time reduction in delivery of goods or services. It is clear that Business to Business electronic commerce represents by far the most compelling business case for virtual trading and will dominate the business opportunity for banks.

Examples of Business to Business Internet Transactions Contracting Contracting Buying and selling of goods/services Buying and selling of goods/services Electronic Mail ( ) Electronic Mail ( ) Advertisement of Goods/Services Advertisement of Goods/Services Making and Receiving Payments Making and Receiving Payments Creating Awareness of your company Creating Awareness of your company

Business to Business Internet Contracting

Example: One example of this would be a company who owns the building they operate out of. The companies upper management decides that the entire building needs to be re-painted. As a result of this the company hosts an online bid for various painters to offer their prices for the job. After finding a painter with a desired price, the company draws up a contract and s it to him. He in returns places an electronic signature on the contract and forwards it back to the company.

Benefits Internet Contracting  Saved the time and money of hosting the job bidding in person and vice versa.  Saved time and manual labor of by ing the contracts, instead of mailing it through the post office.

Business to Business Buying and Selling of Goods/Services via Internet.

Example: An example of this would be Office Max. Office Max Online sells office supplies to many businesses across the globe. But they also buy their products from wholesalers electronically through the web in order to sell on their web site for a maximized profit.

Benefits of Buying and Selling Goods/Services via Internet. Reduced the manual labor and stress of placing these multitudes of orders manually. Reduced the manual labor and stress of placing these multitudes of orders manually. Saved the time of the person who would be in charge of submitting these orders manually. Saved the time of the person who would be in charge of submitting these orders manually. Created organization (No need for excessive paper work. Created organization (No need for excessive paper work.

Business to Business

Example An example of B2B ing would be an employee sending a letter via internet to an employee at another company, discussing price rate changes.

Benefits of  Saves time, by not having to go through the manual preparation and the number of days it actually takes for it to go through the postal system.  Saves money by not using excess paper or ink, and by not using postage.

Business to Business Advertising of Products/Services via Internet Business to Business Advertising of Products/Services via Internet

Example The shoe company Nike uses their websites to display as well as promote their shoes and apparel to retailers (such as Foot Locker). In return the retailers may purchase the advertised products in mass online.

Benefits of Advertising of Products/Services via Internet Able to reach a more broad range of people Able to reach a more broad range of people Saves money Saves money Reduces manual labor Reduces manual labor

Making and Receiving Payments via Internet

Example When a business orders supplies online, more than likely they will also make an online payment. This process usually involves the buyer inputting their credit card information.

Benefits of Making and Receiving Payments via Internet Fast and Accurate Fast and Accurate Accessible from home or office Accessible from home or office Easily tracked or traced Easily tracked or traced

Creating Awareness of Your Business

When a company does business through the internet, it gives other businesses and customers the idea that the company is cutting edge and on top of the game. This perception in returns creates interest, which in returns attracts business.

My Interview with a Professional in the Field

Stephen D. Smith Of Davis Smith & Co. CPA Firm Reference in Bibliography

Interview Q&A’s Q: What percent of your business transactions done through the web? A: Estimated 60% Q: What transactions do you actually make through the web? A: I bill clients, send and receive bank statements, communicate with clients, I also use to send updates to my staff. Q: How has the web process benefited you and your business? A: It saves me time, money, and reduces stress levels within the company. Q: What new and upcoming technologies are you looking forward to working with? A: I am looking forward to work with web conferencing. My clients and I will be able to have conferences from different cities and states face to face.

Interview Cont. Q: How do you think web technology will play a factor in business to business relationships in 5 years? Q: How do you think web technology will play a factor in business to business relationships in 5 years? A: I believe that in 5 years any business who is not up on the new technology and information will be obsolete. A: I believe that in 5 years any business who is not up on the new technology and information will be obsolete.

In the USA, 78% of the small to medium size firms are online, and more than a quarter of those attribute an increase in revenue to the application of Internet technologies. By 2003, business to business revenue is expected to top $1.3 trillion. For the business- to-business marketplace that's a 3400% increase from the $43 Billion in purchases today.( 17.html ) 17.htmlhttp://ideas.repec.org/p/nbr/nberwo/80 17.html Fact:

The future of Internet in dealings with businesses. Internet usage in businesses will become a necessity not an option Internet usage in businesses will become a necessity not an option Technology will keep improving and innovating. Technology will keep improving and innovating. “Businesses who do not keep up with the new technologies will become obsolete” (Stephen Smith interviewee) “Businesses who do not keep up with the new technologies will become obsolete” (Stephen Smith interviewee)

Conclusion As times move forward so will technology. Businesses will be forced to keep up with the technology. When one company advances their technology, their position in the playing field advances separating themselves from the competition. If competing companies do not also keep up they will be left behind. Business to Business endeavors are greatly affected by this technology movement. Companies have saved billions of dollars from the reduction of time and labor. The web allows businesses to move more smoothly with less convenience. The future of business is within cyber space.

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Bibliography cont. Interview Interview Stephen Smith of Davis Smith & Co. (214) Dallas, Tx