Leveraging Magento B2B Capabilities with ERP Integration

By April 18, 2016 Articles No Comments
ecommerce
Magento has played a big role for retailers by providing ready-made eCommerce infrastructure needed for a full-featured web store to sell directly to consumer or B2C customers. Magento also provides B2B capabilities to sell to business-to-business customers. In this article, we will see what the key unique requirements of B2B web store are and how you can meet them by leveraging Magento B2B capabilities along with ERP integration.

From Cha-Ching to Clicks

Thanks to the growth of eCommerce, businesses can sell directly to consumers. Magento eCommerce engine has been a catalyst in driving this growth for small and mid-sized retailers. It maintains products catalogs, customer contacts, shopping cart, order transactions among other things. Magento web store can be customized to give it a unique branding look and stand out in the crowd. Further, third-party Magento extensions can add features to fill the gaps and enhance the base Magento offering. Getting the web store, however, is neither easy nor free. Just like building a brick-and-mortar store, a lot of planning, creativity and hard work go into building a web store that attracts and serves consumers. Instead of foot-traffic, you are vying for the eyeballs. Instead of the cha-ching sound of a cash register, you’re looking to get clicks on the Complete Order button.

Web Ordering for B2B Customers

While exploiting the whole new B2C opportunity, B2B retailers want to provide the same ease and convenience of web ordering to their business partners. If you are a consumer manufactured goods retailer, for instance, you’ve sold primarily through the reseller network of dealers, big box stores or installers. This B2B customer segment makes a bigger slice of your sales pie. However, B2B businesses have certain unique requirements when opening up their traditional B2C web store to B2B customers.

Unique Requirements for B2B Web Store

1. Different product prices by customer segment, or by bulk order quantities

2. Different order processing and shipping methods by customer segments

3. Presenting up-to-the minute product availability on web store

Here is an efficient and cost-effective way to deliver them utilizing built-in Magento B2B capabilities along with ERP integration.

Aligning Magento Capabilities with ERP

As a B2B retailer, you already have been managing your business well with ERP and CRM, such as Dynamics NAV, Dynamics GP, Salesforce and Dynamics CRM. These solutions have mature B2B capabilities of maintaining accounts and contacts, account credit limits, product catalogs, price levels, prices, inventory, quotes, purchase orders, sales orders, shipping and invoicing. Businesses can continue to rely on these functionalities, while leveraging the Magento B2B capabilities by integrating Magento with ERP.

 

1. Different Product Prices

In a B2B environment, typically product prices differ across customer segments. Retail price for direct consumers, wholesale price for big box stores, discounted price for certified installers, and so on. Similarly, product prices can be based on bulk quantities ordered. For instance, $100 for quantities between 1 and 10, $95 for quantities between 11 and 30, and so on.

ERP systems provide Price Levels. Similarly, Magento provides Customer Groups. Assign customers to the respective customer groups. When presenting product prices and completing the order, Magento uses the prices associated with the customer group that customer belongs to.

Magento also offers Tier Pricing feature, which can be set by the range of order quantities. This feature can be useful for variable prices based on order quantities, especially because B2B customers tend to order in larger quantities than B2C customers do.

Synchronizing Magento Customers, Customer Groups, Products and Prices with those in ERP will accomplish these requirements.

 

2. Different Order Processing and Shipping Methods

Ecommerce is one of the many sales channels for B2B ordering. Orders are also entered directly in your ERP. They are processed and shipped using different methods based on urgency, order quantities, warehouse location and shipping destination. They are fulfilled, shipped and invoiced through ERP which is integrated with warehousing and shipping company.

Bringing Magento web orders into ERP and processing them centrally through ERP will help you address the requirement of applying appropriate shipping method based on customer, customer group and region.

 

3. Up-to-the-Minute Product Availability

As mentioned above, eCommerce is one of the many sales channels for B2B ordering. Adjusting stock levels based on the orders placed in Magento alone is not sufficient to present accurate product quantity or availability. Accurate product availability is based on the orders placed through all sales channels, including Magento. ERP systems centrally track inventory levels based on the orders, returns and warehouse transactions from all channels.

Bringing Magento orders into ERP will automatically adjust inventory levels in ERP. Further updating Magento inventory levels from ERP will ensure that Magento provides up-to-the-minute availability of products to your B2B web customers.

 

Making Magento and ERP Work as One

Here are some examples of making Magento and ERP talk to each another:
  • Maintain products, price levels, and product-prices in ERP. Provide continuous integration of these with Magento products, customer groups and product prices.
  • Maintain customer accounts and their associated price levels s in ERP. Provide continous integration of these with Magento customers and customer groups.
  • Provide continuous integration of web orders received in Magento with ERP with all details including account, billing/shipping addresses, product line items, etc.

Magento-ERP Intregration: Not an After-thought

Assess your B2B requirements for online ordering and compare how these same requirements are met in ERP for off-line ordering. At the minimum, you’re going to need the Magento-ERP order integration, any way, to accurately reflect sales and inventory in your financial statements.

Integrating Magento with ERP should not be an after-thought, but the foundation of your eCommerce strategy. To run your business smoothly, so you can focus on sales, marketing and customer service, your success depends on how well your existing mission critical systems work in harmony with Magento. While you’re doing that, pay close attention to how you can leverage Magento B2B capabilities by aligning them with your ERP.

 

Related links:

Top ERP packages that integrate with Magento

Magento Presents: Essential B2B Resources

Magento ups the ante in B2B commerce


Ashu Shendé is the Managing Partner at IQubz, a data integration consulting firm based in Southern California. Contact Ashu via LinkedIn or by writing to ashu at iqubz dot com.