Last updated on 7th April 2022
Last updated on 7th April 2022
Manufacturing partnerships are largely based on a shared ‘risk and reward’ policy. While each partner plays a unique role, there can also be multiple partnerships in a B2B eCommerce business.
For instance, a manufacturer would partner with a channel distributor to handle product sales, a material's supplier for raw materials, a logistics expert for shipping needs, and so on.
In this guide, we tell you 12 ways you can build strong manufacturing partnerships. You will also learn how manufacturers can sell directly to customers and the 10 ways to do so.
Identifying and implementing the gaps and conflicts that may arise will help you maintain a long-lasting, transparent and healthy manufacturing partnership.
82% of manufacturers and 92% of distributors feel their profitability is taking a dip because of challenges in their partnerships.
To adapt to changes during the Covid-19 lockdown, several businesses were forced to change their vendors.
56% said they had to switch their suppliers for some of their B2B purchases.
Apart from this, there are many other factors you must consider if you want to build, maintain, and even improve your existing manufacturer-partner relationships, which include:
Choosing the right partner can be complex, but gratifying when done right. Try to really know your partner before you finalize anything.
As you choose a partner, keep in mind what your goals are and what might be the most accommodating for you.
You don't want to partner with a new business that has no experience in manufacturing the products you need.
Are they manufacturing products that are similar to yours? If yes, then they understand your market and what it takes to succeed. If not, you want to keep looking.
You may also not want someone who would push to a network of under-qualified subcontractors. Look for their technical capacity. Do they have good resources and machines? Can they produce everything in-house?
Your manufacturing partner must be good at logistical efficiency.
You don’t want someone who has impending regulatory fines or infractions. They should have goodwill in the market and adequate experience. Find out what type of clients have they served in the past.
You don’t want to be over-spending or under-spending. Ask to look at your partner's finances, and request references from their other partners.
And so, it is essential to do market research and find the best manufacturing partner for your needs.
Talk to people. Some of the best leads can come from referrals.
While some manufacturers may claim to do many things, it might be beneficial to find one that specializes in specific products instead.
Your partner should already be producing goods or products that are very similar to your own.
Search for product suppliers by searching for products by their NAICS code. Here’s the link for the United States’ NAICS code, and Canada’s NAICS code.
Once you decide on a manufacturing partner, you must then find out what you need to work on building together - and why it matters,
You have to find out if what you can sell is actually in demand in the market or not.
In a manufacturing partnership, market research plays out as a key step in planning out a business model.
Conducting market research helps you understand your customers.
It also helps identify products that best suit your customer's needs or are in demand in a particular locality, state, or nation.
Identify consumer trends of how certain products performed in the previous years, know what tanked and what worked.
Know everything about your competitors. Know their goals, what makes them stand out, what kind of partnerships they make, who their target audience is, and most importantly, understand what you must do to create better products than them.
You can also use research reports, customer surveys, and target focus groups to better understand your existing customers.
80% of customer service organizations use customer satisfaction (CSAT) scores as their primary customer experience metric.
You can consult experienced researchers to carry out comparative studies and help you gain a competitive advantage over other manufacturers.
The best way to advance and flourish in your manufacturing partnership is to have an open channel of communication with your partner.
In most businesses, the downfall in sales is correlated to tensions and miscommunication between channel partners and manufacturers.
96% of people think the businesses they deal with could improve when it comes to communication and project management.
The customs and values play a significant role in each business culture and can create a lot of friction if not handled delicately.
For instance, the Chinese business culture is very different from the American business culture.
The Chinese build business relationships based on trust, and they may ask personal questions that may seem invasive to Americans.
A partner management software can help you strengthen collaborative selling and keep track of your partners’ needs to run the operation more efficiently.
Before choosing any channel partner, contract manufacturer, manufacturing partnership, or even a supplier, base your decision on statistics and numbers.
Investigate the company, all of its past products, the relationship the company maintains with its customers, suppliers, and partners.
Here are two key aspects to consider:
Past products and sales, to understand your partner’s service offerings, production capacity, existing networks, and technical capability.
Company history, to evaluate their company values, financial stability, regulatory compliance, workforce, and expertise.
By taking time to research all of this, you can make an educated choice of a company and set realistic goals and avoid unwanted surprises.
It’s always better to discuss what you expect out of your partnership before signing your manufacturing partnership agreement.
You can start by setting priorities for different aspects of the business.
Do your products require any specialized or advanced manufacturing capabilities?
Do you want to maintain your current supply chain, expand to a global supply chain, or source new materials?
Are all product materials easy or difficult to source?
How much do you need to produce (volume) and how much do you expect that to scale throughout your partnership?
What regulatory considerations need to be met?
How will your manufacturing partner protect your intellectual property?
What is your budget for this partnership?
These questions can ensure you make the right decision when looking for a strong and long-lasting manufacturing partnership. The best ones will always have thoughtful answers that relate to your needs, rather than just offering a shallow "yes”, “no”, or “let get back to you".
Most manufacturers have moved on to digital transformation during and after the Covid-19 pandemic. And it is something you need to discuss with your partner right at the beginning as you may require to make certain changes that would be an added cost like,
Are you planning to sell directly to your customers online?
What channels would you target?
Do you want to run Google Ads, Facebook ads, etc.? What would be the budget for the same?
Are you going to adopt virtual selling?
Would you have an online eCommerce website or an eCommerce platform?
Do you want to automate certain processes?
Would you also sell on an online B2B marketplace?
Do you want to attend virtual trade shows?
Come up with a business plan, set a budget, and allocate resources for the same.
It’s understood that you can’t plan it out, all at once. The key to successful partner management is to revise your tactical work plan periodically and make the necessary changes in your manufacturing partnership.
In a hyper-competitive market, a product will only succeed if it surpasses all regulatory compliance and uses the most high-grade quality of raw materials for fabrication. In a virtual and global market, the competition is cut-throat and consumers have the entire world to choose a product from.
The smartest way to stay ahead of the curve is by manufacturing and marketing a durable product, produced from the best quality of raw materials, and regulatory compliance. This helps you as well as your channel partner to promote the product much better.
The process of examining inventory to decide and determine the optimum amount of goods to produce to keep your company profitable, keeping up with customer demand, while simultaneously controlling costs and increasing sales is known as inventory analysis.
With effective methods of inventory analysis, you can determine the right amount of cash that needs to be spent and locked up in production, reduce capital costs, decrease storage-related expenses, minimize backorders and stock-outs, control delays in projects, which can effectively help increase profits.
82% of business failures are due to cash flow issues.
Inventory management software is an instantaneous and efficient way to manage our inventory without dissipating a lot of manpower.
Competitive pricing is a policy based on setting prices by using the competitor’s price as a benchmark. It analyzes and examines a customer’s response to a price without estimating costs or potential profits to the business.
To catch a buyer’s eyes, a manufacturer needs to study and poll competitors’ prices, maintain their prices in the same bracket, and strive to give better deals than the competition to grow your manufacturing partnership.
81% of buyers weigh offers from multiple producers to get a more desirable bargain.
Discuss with your manufacturing partners how pricing was decided for products at their end. You may want to discuss sample pricing, production pricing, and the minimum order quantities (MOQs) pricing as well. Also, discuss what are the payment terms and turnaround time for the products.
Research about market trends and economic forces that impact pricing to build a long-lasting and unquestioning manufacturer partnership.
AI-powered Automated pricing systems use software and unique algorithms to gather competitors' price data on different shopping portals all over the internet, compare to your product price, and provide recommendations on whether to increase or decrease our prices, to put it simply.
Sales and operations planning is usually led by senior management. It is a monthly iterative process that compares the results and trends from the previous month to make projections and plans for the next.
Statistical forecasting techniques like this help B2B manufacturers gain a holistic view of planning and also extend this information to the sales, marketing, finance, and operation teams for their collective input and adjustments.
The process of designing and manufacturing any product is not impeccable. It is a process of trial and error. Decisions are made on the fly to change the design or modify it based on an engineering standpoint.
Machines can malfunction, laborers can fall and raw materials can get stuck in transit. In fact, for every one thing that can go right, there is a risk of multiple things going wrong in your manufacturing partnership.
A top manufacturing partner will take the time to work on these problems if and when they arise. No business can be operated without taking risks and being flexible to change a step or two to manage them.
The time between manufacturing a product and selling it to the customer is the most crucial for both the manufacturer as well as the channel partner. The faster a product is manufactured, the faster it can reach the market and generate income.
In a competitive market where the demand and supply curve is not very steep, customers have the option to buy a competitor's product in case manufacturing is slower than the customer demand.
Global manufacturing production increased by 9.4% in 2021, after a pandemic-related drop of 4.2% in 2020.
A manufacturing partnership must work on ways to expedite the production process constantly, so there is better positioning for distribution channels, increased productivity, better customer satisfaction, and increased profitability due to less raw materials inventory.
A survey conducted by McKinsey stated:
Video and live chat were the predominant channels for interacting and closing sales with B2B customers, while in-person meetings and related sales activities have dropped.
99% of B2B buyers claim they will make a purchase in an end-to-end digital self-serve model, with the vast majority very comfortable spending $50K or more online.
What this means for your manufacturing partnership efforts is that to stay competitive in the market, you’ve got to scale up your eCommerce site. Your customers are already there looking for items and buying, and so you must be there too.
It is no secret that going forward, taking your B2B business digital is the only way to survive in the global market.
Manufacturing partnerships must understand and both partners must accept the true cost of ownership of software platforms before they make decisions.
77% of remote workers say they’re more productive when they’re working from home.
Remote working helps the company save on office space and the employees save on daily commute and child care. The secret to doing it right is giving every meeting, call or conference a personalized touch.
In the post-pandemic world, businesses have realized that working remotely is more efficient than going to an office every day.
Video conferences/meetings, project management software, virtual trade shows, and virtual happy hours with the team are a few examples of how manufacturers, partners as well as customers will be doing business in the future.
The evolution of going digital as opposed to starting a brick-and-mortar store to sell directly to consumers has made customer reach and access easier to B2B eCommerce manufacturers than ever before.
Companies are already achieving a stronger workforce by incorporating digital technology such as IoT sensors, smart tools, 5G, edge and cloud computing, industrial wearables, and digital work instructions into their operations.
B2B eCommerce in 2021 grew 1.17 times faster than the growth of all U.S. manufacturing and distributor sales.
Digital Commerce 360, U.S. B2B eCommerce Market Report 2022
In 2022, 45% of manufacturing executives surveyed expect further increases in operational efficiency from investments in the Industrial Internet of Things (IIoT) that connect machines and automate processes.
Deloitte, Manufacturing Industry Outlook 2022
Supply chain disruptions continue to hamstring B2B sellers doing business online, with 43% planning improvements in 2022. At the same time, finding and maintaining skilled staff is causing headaches for 39% of B2B sellers.
Digital Commerce 360, U.S. B2B eCommerce Market Report 2022
Investment in artificial intelligence technologies is also expected to see a CAGR above 20% through 2025.
Deloitte, Manufacturing Industry Outlook 2022
75% of G2000 manufacturers will have established digital platforms to unify product and manufacturing process data.
68% of B2B buyers prefer to do business online versus with a salesperson.
Agility is a key differentiator in competitive industries.
For manufacturers whose entire business lives in the ERP, shipping time isn’t the only factor that determines this. The entire supply chain impacts the date when the order will arrive. With COVID disruptions still settling, some manufacturers are finding this impact larger than ever.
The RDD (requested delivery date) logic in an ERP calculates all factors that influence order arrival date—not only whether the material is in stock, but how quickly the supply chain can respond to demand that’s above stock levels.
Having ERP-integrated solutions that can display RDD automatically, for every SKU, is key. A B2B eCommerce platform, like ewiz commerce, can help you do so.
To find the right B2B eCommerce platform, it is vital to choose an eCommerce solutions partner who exceeds your expectations in all areas your platform needs.
With the guidance of a good eCommerce service provider, manufacturers now have better customer data and a direct selling channel.
Going online quickly with a fast, secure eCommerce store having a user-friendly interface and AI capabilities, you can also get a ready-to-go-live website within 30 days!
An AI-powered eCommerce platform helps accelerate manufacturers' eCommerce journey while giving them more time to concentrate on the prototype, testing, and speedy manufacturing of the product.
Your unique eCommerce website is an online representation of your products and brands.
It is where your B2B customers can directly interact with your brand, customize orders and make purchases just like in a brick and mortar store but quicker.
51% of business buyers come to a B2B eCommerce site attracted by an excellent user experience.
— 2022 U.S. B2B Ecommerce Market Report, Digital Commerce 360
You must have a homepage that is attractive, informative, and highly personalized
Harness the power of AI-powered product discovery, personalization, and recommendations
Adopt a mobile-first approach to your B2B eCommerce site
Must have flexible payment options
Post new blogs around relevant trending or new industry-related topics
Use videos on your site to keep visitors on the site and improve engagement
Use images and infographics
An eCommerce website helps you broaden your potential customer base, market and advertise your products and build strong customer relationships.
Customers return to any store because of how they were treated. A personalized touch is what makes the difference between them buying from you again or going to the competition.
An eCommerce platform allows you to collect customer data and give them personalized product recommendations and offers. And while these things are important, they’re not make-or-break for B2B eCommerce customers.
According to Digital Commerce 360, here’s what manufacturers’ customers are requesting.
Real-time, personalized inventory availability
Personalized pricing governed by customer-specific ERP logic
Real-time, customer-specific credit status from the ERP displayed in B2B eCommerce
Real-time order simulation against ERP business rules (with an intelligent error message returned to the user, to prevent order errors)
Real-time order history and status for all orders logged in the ERP (not just those from B2B eCommerce)
This is why we’re seeing an increasing preference for solutions that include built-in ERP integration.
Every manufacturing partnership goes through a debate when choosing software to monitor your inventory levels in real-time. It is obviously very important to your business and you need to get your hands on as much information as you can before you decide on this.
An inventory management system (IMS) tracks and documents the stock in each warehouse whereas, a warehouse management system (WMS) keeps track of where each item resides in a warehouse.
For any eCommerce platform, integrating an inventory and warehouse management system are the most important factors to make sure that products are stocked, shipped, and delivered on time.
But what happens if you want to change your mind? Maybe there’s better software with newer technology in the market now that wasn’t available earlier.
Your B2B eCommerce platform must be scalable i.e., you should be able to easily move in and out of API and integrations until you find the best fit for your business. This will help reduce any friction in your manufacturer-partner relationships too.
B2B customers of manufacturers want to resell your product and make a profit.
Time-consuming negotiations take place before a quotation is chosen, prices are negotiated and a sale is completed. Customers research their options, weighing multiple quotes before choosing a supplier.
An eCommerce quoting system can guide and help them do so.
A configurable quote system allows customers to go through your catalog and see the customizations to products that they want in real-time instantly.
For instance, a B2B customer wishing to buy blenders can choose the color, make, machine capacity, energy consumption, and any other customizations with just a click. This makes the process of converting a lead to a sale much faster than doing it manually.
Other strategies that an eCommerce manufacturer can apply are call for price/contact for price option, request for quote button on the product page, allowing non-login guests to contact stores, and notify requests for quotes automatically.
Having a centralized eCommerce system eliminates the process of manual upkeep of data and saves costs to maintain data manually.
Also, with an integrated system, you can minimize the number of places where you physically store data. Data can be anything like product data, customer data, website data, financial data, and so on.
Scenario 1: Your product data has to be removed or updated for different operations and platforms. How do you do this?
Scenario 2: Your sales manager needs urgent access to product information before closing a deal. Wouldn't it be faster if he/she had all the data in one place, rather than having to manually check files while the customer waits for an answer?
One way to go about it is to integrate your CRM with data from different systems. This way, your teams can access information whenever they want it.
Also, if you have separate databases for emails, automation, etc., information sharing with other platforms like online B2B marketplaces, ad platforms, etc. can become difficult. You must be able to sync, analyze, extract or reuse your data with ease and security rather than dealing with multiple vendors for different pieces of information.
Brand marketing is a long-term, strategic plan to boost a company's brand and reputation by continuously communicating the brand's identity and values through multiple channels in meaningful and engaging ways.
86 percent of consumers say that authenticity is a key factor when deciding what brands they like and support (Stackla, 2019).
— Stackla, 2019
Brand marketing is a smart way to make a name for your business in the market while building a strong and loyal customer base. Adding social proof is also a great way to build trust.
Having a good eCommerce platform provider will also help you market your products and increase the discoverability of your product on search engines.
Buyers are more willing than ever before to spend substantial amounts through remote or online sales channels, with 35% willing to spend $500,000 or more in a single transaction.
A B2B eCommerce platform with strong automation features can help you attract more B2B buyers.
Automation is the introduction of technology in a business model to increase sales and efficiency. It can help a business reduce order costs, re-direct staff, and deliver personalized customer experiences.
B2B eCommerce automation can increase team productivity by 45% and overall revenue by 49%.
Instead of having multiple vendors managing different aspects of your manufacturing business, you can integrate your eCommerce store with automation tools and software.
Having steady customers is the backbone of running a business. Lead generation is tough and competitive but can be achieved through smart strategies.
Email marketing, web optimization, paid advertising, social media marketing, and content marketing are a few strategies that can work wonders for B2B sales in any B2B eCommerce platform.
Digital analysis is the translation of customer behavior into usable business data. It draws the line between fact and opinion, by providing data-driven insight into customer behavior.
These tools can help businesses understand what customers are doing online and why, and a path to convert this behavior into a digital marketing campaign and generate digital sales.
ewiz commerce is an AI-powered B2B eCommerce platform that deals with all your eCommerce needs including personalized marketing, inventory management, lead generation, automating tasks, multiple payment methods, personalized service, and much more.
ewiz empowers manufacturers to control their entire enterprise with one reliable solution.
With a platform like ewiz commerce, you can take care of most of your partnership needs in one platform. The 24/7 customer service and a dedicated team of experts to help with your day-to-day activities is just a bonus.