Amazon Business is ‘the Marketplace Behind the E-Procurement Solution’: GPTS 2016

Prentis Wilson Amazon Business

Prentis Wilson, who oversees Amazon Business (@amazonbusiness), just took the stage at the ISM and Spend Matters Global Procurement Tech Summit and provided an overview of Amazon’s solution for business. (Follow the event live at #ProcureTech2016!) In framing Amazon Business, Prentis suggested that Amazon Business is “A B2B marketplace — a marketplace of sellers and a whole suite of business friendly technology.”

Is Amazon Business a competitor to P2P providers? No! “We have a great relationship with e-procurement provides," Prentis said. "We are the marketplace behind the e-procurement solution. If spend is happening outside of e-procurement, you’re not getting visibility into it. [With both] you get the value of Amazon and the controls and convenience of your e-procurement solution.”

In this answer, Prentis elaborated on a previous comment he made about how Amazon Business is helping companies attack tail spend. He noted that one of the values of Amazon Business is helping drive “supplier rationalization” programs. One procurement organization that Prentis referenced had 10,000 suppliers with $3,000 per less or year in spending.

This organization was “spending more to maintain the supplier than they were spending with them.” They were able to collapse this spend into Amazon, resulting in both process- and even SKU-level cost savings. (Amazon does not have specially contracted prices unique to a single customer. It is a many-to-many marketplace where the price for a given SKU is dynamic based on the sellers.)

Prentis also noted that Amazon Business leverages Amazon’s broader assets. He notes that “behind the whole shopping experience is the Amazon fulfillment network [including] 90,000 full-time employees working in Amazon’s U.S. fulfillment center.” This logistical strength can bring same-day delivery in 16 different metro areas with “over 1 million items today.” Amazon plans to “leverage the same fulfillment technology for our business customers.”

With technology as a core competence, it will be fascinating to watch how Amazon integrates with e-procurement providers like Coupa, SAP/Ariba, Oracle and others in both standard and new ways. It doesn’t take a #ProcureTech2016 genius to realize the advantage Amazon has over other merchants, distributors and online sellers in working with a broader P2P and e-procurement platform ecosystem.

Voices (2)

  1. Kris Colby:

    Great angle for tail spend.

  2. Patrick Connaughton:

    Thanks, Jason. Keep the coverage coming on Amazon Business. I honestly think that this could represent a huge game changer for e-procurement. On the surface it solves a ton of issues when it comes to tail spend. Did he share any case studies on how they’ve integrated with an e-pro solution?

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