B2B sales on Amazon came as a surprise and they keep growing
Stephan Harpeng
CEO Assistant and Quality Manager, TIGA-MED
TIGA-MED, based in East Thuringia (Germany), started as a completely offline business selling medical products and disposables to hospitals and nursing homes. Now, the company aims to offer medical products at reasonable prices for a very wide and diverse range of customers as they noticed a great need for such products outside of professional care services (among private buyers, gloves for catering industry etc.). Their online channel has grown a lot in recent years and now accounts for nearly 50% of their activity, with Amazon being the main online store they use.
The COVID pandemic was a challenging time for the medical products industry as supply chains were struggling with disruptions and delivery times became very long. On the other hand, demand reached an unexpected peak and could not be fulfilled. It was particularly hard for keeping B2B customers, because they appreciate constant availability of products as they do not want to switch to products from a different manufacturer. Now the industry is back to normal and the supply chain is stable again.
The COVID pandemic was a challenging time for the medical products industry as supply chains were struggling with disruptions and delivery times became very long. On the other hand, demand reached an unexpected peak and could not be fulfilled. It was particularly hard for keeping B2B customers, because they appreciate constant availability of products as they do not want to switch to products from a different manufacturer. Now the industry is back to normal and the supply chain is stable again.
How we get so many new customers on Amazon Business
At first, the company considered Amazon as purely a B2C marketplace, but then "noticed that the B2B demand went up a lot, noticed customers like medical practices, out-patient care services and retirement homes were buying on Amazon, which was a surprise at first". On Amazon Business, TIGA-MED now has many B2B customers from the catering industry and facility management companies. Stephan Harpeng, CEO Assistant and Quality Manager at TIGA-MED, notes that the share of their B2B business on Amazon is currently at 20%: "20% is actually already more than we had expected and the B2B segment continues rising very fast".
What Stephan finds most exciting about Amazon Business is that B2B customers can buy their products "with the same convenience that they are used to from Amazon and with good conditions. With the business offers, B2B customers can cover their needs very well and just as easily as they would when shopping privately on Amazon. This is very attractive to customers and is therefore a very good market for us." He also points out that they can build business customer loyalty on Amazon Business: "The majority of our products are disposables, so when we have good offers and the customer is satisfied with the product, it’s very likely that they will buy the same product again immediately after using up the first delivery."
Coming from offline B2B business, TIGA-MED expanded their customer base by selling on Amazon both to B2C and to new B2B customers.
What Stephan finds most exciting about Amazon Business is that B2B customers can buy their products "with the same convenience that they are used to from Amazon and with good conditions. With the business offers, B2B customers can cover their needs very well and just as easily as they would when shopping privately on Amazon. This is very attractive to customers and is therefore a very good market for us." He also points out that they can build business customer loyalty on Amazon Business: "The majority of our products are disposables, so when we have good offers and the customer is satisfied with the product, it’s very likely that they will buy the same product again immediately after using up the first delivery."
Coming from offline B2B business, TIGA-MED expanded their customer base by selling on Amazon both to B2C and to new B2B customers.
We gained a lot of new customers by selling on Amazon. We've been selling on Amazon for 11 years now and still we're adding a huge number of new customers every day.Stephan HarpengCEO Assistant and Quality Manager, TIGA-MED
Amazon Business tools help to grow our B2B orders
Manage Quoteswas the first tool TIGA-MED used on Amazon Business, and with that tool they started receiving more and more enquiries from potential customers. "When we started adding Business Prices and Quantity Discounts, that led to a significant increase in B2B sales." Stephan estimates that, since using Quantity Discounts, the size of B2B orders has increased by at least 40%. "If I imagine myself looking for a product, I would probably do the same: I know my quantities, I know my demands, so of course I would look for a bulk package to get a better price. I consider Business Prices and Quantity Discounts to be the most efficient tools to attract B2B customers, because everyone is looking for discounts, privately or in B2B", he says. Stephan finds quantity discounts especially important for the medical sector because, due to the large proportion of single-use, disposable products, quantities are very high. For the same reason, bulk purchases are also very useful in the medical sector.
TIGA-MED appreciates the advantages of the VAT Calculation Service that they use with an external partner (VCS Lite):
TIGA-MED appreciates the advantages of the VAT Calculation Service that they use with an external partner (VCS Lite):
As we are also B2B customers on Amazon, we really appreciate the importance of having our invoice right after the goods are dispatched. Seeing the prices without VAT is also a very good feature for B2B customers, because you don't want to have to pick up your calculator and calculate it yourself.
Enjoying working with B2B customers
TIGA-MED shares some insights on their experience with B2B customers: "With B2B customers, there is always 'less struggle' than with B2C customers. They know the product very well, they know what they are looking for and they know how to use it. So, of course, this is a big advantage and the return rates are very, very low." Stephan points out that the feedback from shipping companies is that delivery is much smoother and easier with business customers, fewer contact details are missing and delivery instructions are more precise. "The shipping companies prefer B2B customers!"
Advice for sellers: don't miss out on the B2B potential of your business on Amazon
"I would recommend giving a significant discount to B2B customers, because it will lead to increasing B2B sales. As a result, B2B customers buy the same item again very quickly, because their demand is greater and more constant than in the B2C environment. In the case of quantity discounts, it naturally makes sense to align them with the quantities of products in a box or shipping unit, so you can save shipping costs for yourself and the customer always gets full boxes, which are not likely to get damaged when getting shipped. It's a win-win: you save on extra packaging and shipping costs", Stephan explains.
He particularly emphasises: "I think you should never underestimate the potential share of B2B customers on Amazon, that was what we did. We never expected the B2B share to rise that quickly. B2B customers appreciate a quick and convenient shopping experience, just like everyone else. If you have a good product and you can meet the needs of B2B customers, you should just give it a try. After all, there is nothing to lose but there is a lot to gain."
He particularly emphasises: "I think you should never underestimate the potential share of B2B customers on Amazon, that was what we did. We never expected the B2B share to rise that quickly. B2B customers appreciate a quick and convenient shopping experience, just like everyone else. If you have a good product and you can meet the needs of B2B customers, you should just give it a try. After all, there is nothing to lose but there is a lot to gain."
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