B2B SALES MODELS: how to align them with e-commerce strategies?

Following our discussion on the differences between B2B and B2C, we believe it is important to explore the different popular sales models in B2B.
Key Definitions
Before we go into the models, let’s define the key terms used in this article:

• Manufacturer – A company that designs, produces, and sells products. Manufacturers can sell directly to businesses or rely on intermediaries like distributors and dealers.
• Distributor – A company that purchases products from manufacturers and resells them to dealers or end users. Distributors typically manage logistics, storage, and regional sales.
• Dealer – A business that buys products from distributors or manufacturers and sells them to end users. Dealers may provide customer service, sales support, and installation.
• One-time or Permanent Intermediary – A party facilitating transactions between manufacturers and end users. A one-time intermediary participates in a single transaction, while a permanent intermediary regularly works with the manufacturer but without fixed terms.
• End User – The final business that uses the product in its operations.

Sales Model 1: Manufacturer Does Direct Sales

The manufacturer sells directly through one or more legal entities or regional offices. This model is common for many large manufacturers, particularly in Europe, where they prefer to maintain full control over their sales.
Advantages:

• Full control over customer relationships – The manufacturer directly manages interactions with customers.
• Market insights from direct communication – The company receives feedback firsthand, allowing for quick adaptation to market needs.
• Faster feedback loops – The manufacturer can react to customer concerns, improving service and product quality.
• Control over reputational risks – Dealers or distributors may not always align with the manufacturer’s quality standards, potentially damaging the brand.
• More flexible cash flow – Unlike distributors and dealers, which often require extended payment terms, manufacturers can control their cash flow better.

Challenges:

• Higher fixed costs – Direct sales require an investment in personnel, assets (vehicles, equipment), and physical infrastructure (offices, warehouses).
• Diversification of competencies – A good manufacturer is not necessarily good at direct sales. Sales and marketing require different expertise.
• More complex financial structure – Dealers usually manage their own pricing and expenses. Without them, all costs fall on the manufacturer, which can be risky in economic downturns.

B2B Customer Portal Setup:

• External attributes – A single website per market (e.g., EU) or for a group of regions (e.g., Middle East). Possibility to open the prices and/or on-line orders.
• Pricing – Standardised pricing for the market/region.
• Special pricing for VIP clients and intermediaries – Directly assigned discounts.
• Order processing – Direct order placement with the manufacturer or a designated legal entity.

Sales Model 2: Manufacturer Sells Only Through Dealers, While Controlling Retail Prices

The manufacturer does not engage in direct sales and does not have an in-house sales team. Instead, the sales team focuses on brand development and supporting regional dealers or distributors. Dealers are assigned based on geographic divisions such as countries, regions, or postal codes. The manufacturer maintains control over public (Retail) pricing.
Advantages:

• Simplified financial model – The manufacturer only manages Retail prices and Dealer discounts.
• Lower fixed costs – No need to maintain an internal sales team or sales infrastructure.
• Focused expertise – The company can concentrate on product development and brand positioning.
• Easier regional expansion – The dealer network allows for faster entry into new markets.
• Retail price transparency – Standardized pricing enables open advertising without conflicts.
• Synergy with dealer offerings – Dealers often provide complementary services, such as turnkey solutions.
• Reduced risk of corruption – Because of the public pricing policy, there is less exposure to unethical sales practices.

Challenges:

• Limited control over customer relationships – The manufacturer’s direct engagement is limited to marketing and rare complaint resolution.
• Dependence on dealer expertise – A dealer may be strong in certain industries or regions but weak in others.
• Brand dilution risk – Dealers represent multiple brands, which may affect brand positioning.
• Potential reputational risks – Dealers may damage the brand’s reputation due to poor service.
• More flexible cash flow for dealers – Dealers, and especially distributors, often negotiate long payment terms, impacting cash flow.

B2B Customer Portal Setup:

• External attributes – A single website per market, since the manufacturer controls pricing.
• Pricing – Standardized pricing across the region.
• VIP client pricing – Dealers must be given authority to assign discounts to VIP customers.
• Order processing – Customers place orders through the manufacturer’s website, but confirmation and further documentation are issued by the dealer. Dealer gets order notification immediately.
• Integration requirements – Either a two-way system exchange with the dealer’s system or limited portal access for dealers to manually update order status.
• Dealer website support – The manufacturer may recommend or provide website templates for dealers individual web pages.

Sales Model 3: Manufacturer Sells Only Through Dealers and DOESN’T Control Retail Pricing

In this model, the manufacturer does not engage in direct sales and does not control retail pricing. Instead, it only sets NET prices for distributors or dealers. The sales team focuses on brand development, and dealers operate independently with full pricing control.
Advantages (different from Model 2):

• Simplified financial model – Even more simplified pricing model, where you set only the NET price-list
• Increased dealer satisfaction - In most cases, the equation is simple: less control = a happier dealer (from their perspective). When manufacturers give dealers more autonomy in pricing, sales processes, and customer interactions, dealers often feel more empowered and motivated.

Challenges (different from Model 2):

• Higher risk of unethical sales practices – Dealers may set extreme markups or engage in local corruption.
• Unclear Market Positioning – Depending on each dealer’s strengths and sales strategy (volume-driven vs. margin-focused), your brand perception may vary across different regions within the same "territory". This inconsistency can lead to mixed messaging, making it harder to establish a unified market presence.

B2B Customer Portal Setup:

• External attributes – The website cannot display Retail prices or must show inflated prices to avoid conflict with dealers
• Dealer website support – The manufacturer may recommend or provide website templates for dealers individual web pages.
• Dealer portal access – A dedicated portal for dealers only with login-based access.
• Order processing – Fully handled by the dealer, but still can be handled by them with e-commerce tools.

Sales Model 4: Mixed Model – Direct Sales in Some Markets, Dealer Sales in Others

In this scenario, the manufacturer adopts a hybrid model, selling directly in some markets (usually developed ones) while relying on distributors in others. The manufacturer controls base (Retail) pricing to prevent internal competition.
Advantages:

• Strategic control over key markets – The manufacturer retains direct relationships in high-priority regions.
• Adaptability – This model allows a customized approach for different territories.
• Price consistency – Controlled Retail pricing avoids market undercutting.
• Operational flexibility – The manufacturer benefits from both direct control and dealer partnerships.

Challenges:

• Complex sales management – Balancing both direct and dealer sales channels adds operational complexity.
• Pricing conflicts – Managing different pricing structures across markets can be challenging.
• Customer experience inconsistency – Direct sales may offer better service, while dealer markets may vary.
• Lack of Dealer Confidence – Dealers understand that the better they perform in market development, the higher the chance that the manufacturer might eventually enter the market directly. This uncertainty can lead dealers to focus on contingency plans (“Plan B”).

B2B Customer Portal Setup:

• External attributes – Both strategies are possible. One web page with on-line order possibilities for direct and indirect sales or/and individual web portals for every distributor.
• Pricing – Manufacturer-controlled Retail pricing in direct sales regions
• Special pricing for VIP clients – Managed across both channels.
• Order processing – Direct orders are processed internally, while dealer orders are routed through a distributor portal.

Each B2B sales model comes with its own set of advantages and challenges. While direct sales provide full control, they require greater investment. Dealer-based sales lower costs but reduce brand control. A hybrid approach offers flexibility but requires careful pricing and channel management.
When designing a B2B e-commerce strategy, businesses should choose a model that aligns with their goals, resources, and target markets. Proper customer portal implementation can optimize sales efficiency and improve the overall buying experience.
Our Key Message: Stay ahead of the time. You can’t keep your prices hidden forever - the market has evolved. If you’re not integrating e-commerce into your B2B strategy today, you risk falling behind tomorrow.