CCID Consulting Forecasts Development Direction of B2B in Ch
BEIJING, July 5 /Xinhua-PRNewswire/ -- CCID Consulting, China's leading research, consulting and IT outsourcing service provider, and the first Chinese consulting firm listed in Hong Kong (HKSE: 8235), forecasts the development direction of B2B in China.
Under a general environment of innovation, integration and a win-win mentality, China's e-business market has been maintaining fast growth momentum. At the end of 2006, the trading value in the market reached 1.1 trillion Yuan. As the mainstream e-business of China's e-business market, B2B trading value amounted to 1.0044 trillion Yuan, up by 47.5% over 2005, accounting for 91.3% of the overall e-business trading value. Though the B2B trading value has already topped 1 trillion Yuan, CCID Consulting predicts that as the overall e-business environment continues to improve and various small- and medium-sized businesses (SMBs) collectively wake up to take part in e-business, B2B businesses will still maintain a high growth of over 40% in the next 5 years.
Fig. B2B Business Trading Values and Forecast in China, 2004-2011
Source: CCID Consulting, Jan. 2007
All roads lead to Rome -- two main service models for B2B
In addition to some big enterprise groups, which build their own e-business platforms to make online procurements and sales, there are also a number of firms actively engaged in B2B information and trading services in China's B2B e-business market. According to their service scope and content, they can be divided into 2 types: integrated B2B service platforms represented by Alibaba and vertical B2B service platforms represented by http://china.chemnet.com under Netsun.
Integrated B2B service providers represented by Alibaba have set up a huge information collection and release platform. By providing rich supply and demand information to SMBs in various industries, they can help them to look for business opportunities and make deals. As a leading service provider, Alibaba's Trust and China Suppliers & Products help SMB customers to promote themselves, to create good publicity, and to look for business opportunities on the Internet.
Industry vertical B2B service platforms represented by china.chemnet.com are extremely large in number. But, compared with integrated trading platforms, their size is still small. However, they often have a more profound understanding of the industry and thus can also provide more professional information and services. As for promoting trade, they play the same role as integrated B2B platform service providers do.
As e-business services are gradually segmenting, integrated B2B service platforms have strengthened efforts to explore vertical industry services. To give play to the scale effect, vertical B2B service platforms are also looking for alliances with several industries to develop integrated information services. For service providers, every road leads to Rome. The ultimate goal is to provide customers with the most comprehensive and tailored services. Service providers seek to realize their own value while helping customers to increase theirs.
There are no permanent friends or enemies -- cooperation and competition coexist in the B2B market.
In the integrated B2B market, services providers such as Alibaba, hc360 and Global Sources have never stopped competing with one another. Alibaba has taken up a market share of over 50%. In 2006, Global Sources started to join hands with hc360 to develop China's SMB market. Combined, they have a total market share of some 30%. In the integrated B2B market, the general consensus is that Alibaba has become the leader.
Integrated B2B service providers have long maintained good cooperative relations with most vertical industry websites. Such websites provide integrated B2B platforms with content and information, thus helping them to save considerable manpower and material resources. Integrated B2B platforms bring more traffic to industry websites, thus implying that more advertising and other business opportunities will arise from that. However, after Netsun was listed, china.chemnet.com, as a rapidly rising industry B2B platform representative, engaged in a Derby with Alibaba in the same city, thus setting the scene for competition between integrated B2B service providers and vertical B2B service providers. Drawing upon its website http://www.netsun.com , Netsun has engaged in an in-depth cooperation with industry websites, establishing website alliances, and opening up to all industries. This eventually formed a situation of transition towards integrated B2B. On March 20, 2007, Alibaba introduced 4 new industry websites, including a chemical industry website. It has been manoeuvering to engage in an all-out battle with china.chemnet.com.
Regardless of cooperation, competition or antagonism, the most fundamental driving force is always acquisition and allocation of interests. B2B e-business services in China have reached a stage where innovative applications are called for. Service providers should therefore place their focus on expanding new services and profit spots and increase their returns while increasing values for users.
Only a win-win market is a successful market -- expansion of new services and new profit spots
Though integrated B2B service providers and vertical B2B service providers have entered a stage of frontal competition, services between these two camps are increasingly identical. Meanwhile, in the face of SMB users, they show a lack of marketing means and monolithic profit models. This is an undisputed fact. China's B2B services market is in urgent need of exploring new services and innovating new profit models: in essence, forging ahead.
Integrated and vertical B2B service providers should build on their own advantages to explore different types of services and profit spots. For integrated B2B service providers, though the trend of industry segmentation requires them to provide more professional content, such content can nevertheless be obtained through cooperation with professional websites. Integrated service providers usually have large numbers of enterprise users. Providing services in relation to enterprise users' other demands will bring new sources of revenues to integrated B2B service providers. For example, Alibaba's Ali Software has targeted the SMBs' software needs. Vertical B2B platforms lack big user numbers as their foundation. However, their profound industry experiences are often their advantages. Vertical B2B service providers should therefore build on such advantages, provide industry enterprises with one-stop services ranging from information, trading to even logistics. Strengthening offline interaction with enterprises is the only way to more reflect the features of vertical industry websites.
CCID Consulting thinks that future B2B services in China will expand in breadth and depth. As long as integrated B2B service platforms and vertical B2B platforms find the right position, they can get their share of China's huge e-business market. The era of survival by taking market shares from competitors is as distant as ever. The main development in China's B2B service market in the next few years will be that cooperation far outweighs competition.
About CCID Consulting
CCID Consulting Co., Ltd. (also known as CCID Consulting), the first Chinese consulting firm listed in the Growth Enterprise Market of the Stock Exchange (GEM) of Hong Kong (stock code: HK08235), is a direct affiliate of the China Center for Information Industry Development (hereinafter known as CCID Group). Headquartered in Beijing, CCID Consulting has so far set up branch offices in Shanghai, Guangzhou, Shenzhen and Harbin, with over 300 professional consultants and industry experts. The Company's business scope has covered over 200 large- and medium-sized cities in China. Apart from home market development, CCID Consulting is establishing international cooperation links across the United States, the Asia-Pacific region and Europe, by setting up agents in the U.S., Japan, South Korea, Australia, Singapore, Italy and Russia, with the aim of going global.
Based on four major competitive areas of powerful data channels, industrial resources, intense knowledge and deep understanding of information technology, CCID Consulting provides customers with consulting, research and IT outsourcing services covering strategy planning, IT application, marketing strategy, human resources and information technology outsourcing. Our customers range from industrial users in IT, telecommunications, energy, finance, automobile, to government departments at all levels and diversified industrial parks.
CCID Consulting is committed to becoming the No. 1 brand for strategy consulting, the No. 1 consultant for enterprise management and the No. 1 expert in market research. For more information, please visit our website at http://en.ccidconsulting.com/.
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