Leading online retailers are now targeting the B2B procurement space. Are there risks for small-business owners buying supplies from Amazon and eBay?
In the span of about 15 years, online retail sales have grown from a tiny niche to more than $200 billion in revenues. Companies like Amazon and eBay are now looking for the next sector to dominate, and it seems business purchases may be their target. Moving beyond books and electronics, they’re starting to distribute machine parts, industrial goods and other products consumed by small businesses.
While this may lead to better pricing for small-business owners, you need to consider several risks if your company is starting to buy more from online distributors:
The terms and conditions typically found in your purchase orders are superseded by the terms and conditions of the websites where you purchase.
Your business is likely to have less leverage negotiating with Amazon than it will with a local distributor.
Rogue purchasers—employees that spend company money without an approved budget—will be enabled by the ease with which they can order online.
About small business finance expert Mike Periu
Mike Periu has experience in small business finance. He founded Proximo, LLC a company that offers consumer and small business training services focused on technology and money.
Mike Periu teaches individual empowerment through entrepreneurship and financial literacy. He has appeared 500+ times on television and radio. Visit the Reach and Media pages of his website to learn more about where he has appeared.
You can read more of Mike’s articles on his blog or at American Express OpenForum, Yahoo! Finanzas and the Huffington Post.
Mike has a degree in International Business and Finance which he received at Georgetown University in Washington, DC. He received a Fellowship from the Kauffman Foundation for the Labs for Enterprise Creation program in Kansas City.
