E-procurement platform: which specifics should be taken into account regarding payment?

E-procurement platforms bring together corporate buyers and their suppliers. By centralising offers, this type of marketplaces facilitates B2B purchases and thus saves time and ensures better prices for companies. However, for the model to work, it is essential that the payment solution deployed takes into account the characteristics of B2B purchases. Here are some explanations.

E-procurement platform: which payment methods for B2B?

To offer the most suitable payment methods for B2B on your e-procurement marketplace, three specificities must be taken into account:

• There are three purchase types:
  • Category A: recurring and strategic purchases for output. Example: raw materials
  • Category B: recurring and strategic purchase outside of production. Example: informatic material
  • Category C: non-recurring and non-strategic purchases. Example: stationery for offices
• The amounts of B2B purchases are generally high.
• In 80% of the cases, companies pay their purchases by the due date, either 30, 45, or 60 days after their order.

These characteristics have a direct impact on the means of payment used. Bank cards and more specifically virtual cards are very much used for category C purchases. In fact, it makes it possible to meet the challenges of this type of purchase, the amounts of which are generally quite low, while granting an attractive payment period.

As for A and B categories, purchases can reach significant amounts. Bank transfers and direct debits are therefore preferable for your e-procurement platform. In fact, as payment costs are lower, these means of payment have less impact on the merchant.

Also, you should know that direct debit is the most popular payment method for B2B buyers (in 80% of cases): it considerably simplifies the process.

Credit insurance and billing mandate, key services for e-procurement platforms

Insofar as payment on time is involved in the vast majority of cases, credit insurance appears to be a key service for e-procurement platforms. As its name suggests, credit insurance provides the seller with a payment guarantee following a deferred payment purchase. The seller is then guaranteed to be paid in case of unpaid invoices from the buyer. Credit insurance is a service that covers the sellers, who will thus be more involved in the marketplace.

Another specificity to take into account: a company can have many suppliers. As such, it is in the e-procurement platform’s best interest to offer an invoicing mandate service, which allows the marketplace to issue a single invoice on its behalf. This system facilitates the accounting of the purchasing company, which no longer has to process as many invoices as the number of suppliers from which it makes a purchase.

E-procurement platform, the importance of deploying technology for UX

The e-procurement platform’s mission is to simplify the user’s path so that professionals can focus on the most strategic purchases for their company.  Two technologies are particularly suited to this challenge:

• SDD Opt-in: digitalisation of the direct debit mandate. It can be a real differentiator in the supplier/payer experience set up by the platform.
• Pay by link: in case of payment by card, a secure link is sent to the buyer. This facilitates the payment process considerably and allows the buyer to avoid wasting time on low-value orders.

The user’s experience can then be enhanced with a dashboard with accurate and automated accounting data exports. This feature is very appreciated by companies as it facilitates financial reconciliation.

Corporate purchasing managers are modeling their professional experience on their personal practices and are therefore increasingly turning to e-procurement platforms. However, the success of this model depends above all on the platform’s response to the specificities of B2B. To do this, it is essential to consider the characteristics of the sector in terms of payment. An operation that can be tedious… and for which support may be necessary. In this respect, there are many advantages to turning to a PSP.

To support marketplaces in their project, Lemonway, a certified payment provider, takes care of the management of their payment flows, by integrating into their platform functionalities that are truly adapted to B2B issues. Do you have a project? Any questions? Tell us about your needs!