---
title: "2016 China B2B E-commerce Industry Research Report"
description: "China's B2B e-commerce transaction scale has grown steadily, reaching 11.8 trillion yuan in 2015. Application software service models provide technical support for bulk commodity trading B2B e-commerce. For SME B2B e-commerce, deep supply chain needs and the ability to provide comprehensive services will be future competitive points."
author: "分析师 焦定坤"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2016-06-07"
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# 2016 China B2B E-commerce Industry Research Report

> China's B2B e-commerce transaction scale has grown steadily, reaching 11.8 trillion yuan in 2015. Application software service models provide technical support for bulk commodity trading B2B e-commerce. For SME B2B e-commerce, deep supply chain needs and the ability to provide comprehensive services will be future competitive points.

**Abstract**
China's B2B e-commerce transaction scale has grown steadily, with the market transaction scale reaching 11.8 trillion yuan in 2015. The application software service model provides technical support for the development of bulk commodity trading B2B e-commerce. For SME B2B e-commerce, deep supply chain needs and the ability to provide comprehensive services will be future competitive points.

**Macro Environment: Policy Supports Traditional Industry Structural Transformation**
**Capital Market Drives Rapid Development of B2B E-commerce**
According to iResearch analysis, against the backdrop of overall economic slowdown, the national push for supply-side reform is a significant opportunity for B2B e-commerce development. "Internet + Traditional Industries" will grow rapidly in the B2B e-commerce field.

**Economy: China's PPI Index Continues to Decline, Industrial Economy Sluggish, B2B E-commerce Becomes One of the Transformation Paths**
2015 was a year of comprehensive reform and adjustment in China, with GDP growth continuing to decline and economic structure continuously adjusting. In December 2015, China's PPI index fell 5.9% year-on-year, marking the 46th consecutive month of decline. Industrial production enterprises suffered severe losses and urgently needed structural transformation. B2B e-commerce became one of the transformation paths for traditional industrial enterprises.

**Economy: B2B E-commerce Reduces Distribution Links, Improves Transaction Efficiency, and Lowers Procurement Costs**
The distribution channels of traditional industries are lengthy and complex, with low efficiency and high costs. Taking raw material trade as an example, from raw materials to the final processing stage, they pass through multiple levels of distributors and wholesalers, each adding a markup, resulting in a long supply chain, low efficiency, and relatively high costs.

Comprehensive B2B e-commerce platforms near the production end, represented by Yihuobaiying, directly connect raw material suppliers and purchasers through the platform, improving transaction efficiency and reducing costs for downstream purchasers.

**Policy: Supply-side Reform Drives Economic Growth from the Production End Supply Chain, Becoming a New Opportunity for B2B E-commerce Development**
An important part of supply-side reform is to reduce ineffective and low-end supply, expand effective and mid-to-high-end supply, and enable supply and demand to synergistically promote economic development.

In the traditional economic form, producers cannot understand reasonable demand; in the B2B e-commerce platform economy, producers can use big data to understand buyer demand. iResearch analysis believes that under the hot topic of supply-side reform, B2B e-commerce can fully leverage the efficient connection function of the Internet to achieve efficient matching of upstream and downstream supply and demand, helping enterprises solve problems such as overcapacity, high distribution costs, and insufficient effective supply.

**Policy: Manufacturing Industry Transformation and Upgrading, Deep Integration with the Internet, Favorable Policy Environment for B2B E-commerce Development**
Manufacturing holds an important position in the national economy, accounting for 76.8% of total industrial output value in 2014.

The 2016 Government Work Report proposed using information networks and other modern technologies to promote changes in manufacturing production, management, and marketing models, reshape industry chains, supply chains, and value chains, transform and upgrade traditional drivers, and promote manufacturing transformation and upgrading.

iResearch analysis believes that manufacturing transformation and upgrading, as well as national support for the network economy, provide a good external environment for B2B e-commerce development, with a favorable policy environment.

**Society: SMEs Achieve Comprehensive Internet Penetration**
**Providing Basic Conditions for B2B E-commerce Development**
By the end of 2015, 90% of Chinese enterprises used the Internet for office work, and the foundation for Internet applications had been basically consolidated.

On the one hand, with the development of the Internet, SMEs have basically moved their traditional stores online, using Internet portals for publicity; on the other hand, enterprises mainly use the Internet for sending and receiving emails, obtaining or displaying information, and direct use for business transactions is still limited.

iResearch analysis believes that most enterprises have not truly entered the stage of enterprise e-commerce, that is, achieving the entire online transaction process through Internet information services. SME e-commerce still has significant room for development.

**Technology: Cloud Computing and Big Data Development Provide Technical Support for B2B E-commerce**
iResearch analysis believes that with the improvement of cloud computing and big data technology, B2B e-commerce will be greatly developed. On the one hand, it can more accurately analyze market demand, improving transaction quality and efficiency; on the other hand, through cloud computing and big data analysis, B2B e-commerce can provide enterprise transaction data to banks and other financial institutions as important credit credentials for corporate financing.

**Investment and Financing: SME B2B E-commerce at the Capital Wind Gap, Favorable Investment and Financing Environment**
In 2015, total investment in the B2B e-commerce field exceeded 5 billion yuan, a year-on-year increase of 699%. Among them, bulk commodity trading B2B e-commerce received over 50% of the investment. SME B2B e-commerce has become a field for capital follow-up investment. Shanghai Ganglian has a market value of over 20 billion yuan, and Zhaogang.com's valuation has exceeded 1 billion US dollars.

iResearch analysis believes that SME B2B e-commerce is at the capital wind gap, and in the foreseeable future, it will remain a hot spot for capital investment.

**Users: SME Transformation, B2B E-commerce Becomes the First Step in Implementing "Internet +"**
Against the backdrop of the global financial crisis and hindered export trade, Chinese SMEs are seeking new product promotion and sales channels and transaction channels. E-commerce, with its low cost and high efficiency, is gradually becoming the first choice for SME transformation for online product promotion, sales, and transaction matching.

iResearch analysis believes that the demand for SME B2B e-commerce will continue to grow.

**Pain Points: Payment and Settlement, Resource Management, and Transportation and Warehousing Are Three Key Points for Bulk Commodity B2B E-commerce Development**
The imperfect payment and settlement system for bulk commodity trade, chaotic resource management, and restricted cross-regional transportation are key points for expanding the scale of SME B2B e-commerce.

**China's B2B E-commerce Emerged from Yellow Page Information Display, Developed through Transaction Matching, and Moves Toward Big Data Integration**
In the B2B e-commerce 1.0 era, the focus was on information display, transferring offline information to the Internet, with websites profiting from membership fees and information promotion service fees; in the 2.0 era, more and more enterprises began to engage in transactions, using systems or manual matching for supply and demand information matching and online transactions, striving to achieve a closed transaction loop; in the 3.0 era, with the development of cloud computing and big data, B2B e-commerce will connect the supply chain, providing a series of services including warehousing, financial credit, etc., for both buyers and sellers.

**China's B2B E-commerce Transaction Scale Grows Steadily, Reaching 11.8 Trillion Yuan in 2015**
According to iResearch Consulting's 2015 China e-commerce market transaction data, in 2015, China's B2B e-commerce market transaction scale reached 11.8 trillion yuan, an increase of 18.0% over the previous year, and will maintain stable growth. Among them, SME B2B e-commerce transaction scale accounted for 44.2% of the total e-commerce transaction scale. B2B e-commerce still has significant room for development.

**SME B2B E-commerce Transaction Scale Continues to Increase, Reaching 7.2 Trillion in 2015, Up 17.1%**
According to iResearch Consulting's 2015 China e-commerce market transaction data, in 2015, the transaction scale of SME B2B e-commerce in China was 7.2 trillion yuan, a year-on-year increase of 17.1%; the transaction scale of above-scale B2B was 4.6 trillion yuan, a year-on-year increase of 19.5%.

**China B2B E-commerce Industry Ecosystem Map**

**SME B2B E-commerce Can Be Classified by Service Field, Service Model, and Service Content**
**Comprehensive Model B2B E-commerce Targets Intermediate Trading Markets**
**Vertical Model B2B E-commerce Targets Industry Segments**
In the comprehensive model, B2B e-commerce neither owns products nor operates as a merchant; it only provides a platform where buyers and sellers can find information about each other and products. In the vertical model, B2B e-commerce focuses on a specific segment, forming supply relationships with upstream suppliers and sales relationships with downstream buyers.

**Platform Matching B2B Matches Supply and Demand Information Manually or Systematically; Self-operated B2B Purchases and Sells on Its Own**
Platform matching B2B matches suitable suppliers and products based on buyer demand information through manual or systematic analysis to facilitate transactions. The platform does not own products, only provides services. In the self-operated model, e-commerce websites purchase products from suppliers and sell them to downstream buyers, with the website owning warehouses to store products.

iResearch analysis believes that the matching transaction model is lighter and more suitable for industries where both upstream and downstream are dispersed and downstream demand is sudden; the self-operated model is heavier and more suitable for industries where upstream resources are concentrated and downstream demand is relatively stable.

**Information Service Model Connects Supply and Demand Through Information, Providing Transaction Opportunities**
iResearch analysis believes that the advantages of the information service model B2B e-commerce are gradually disappearing, and other emerging e-commerce forms are quickly dividing most of the market. In the future, the information service model will no longer be the mainstream, but it will exist as a basic service in every stage of B2B development.

**Online Transaction Model Completes All Links from Order to Evaluation Online, Achieving a Closed Transaction Loop**
With the development of B2B e-commerce, the traditional information plus advertising service model can no longer meet the needs of both supply and demand. B2B e-commerce websites are transforming from information service platforms to online transaction platforms. Through the platform, orders, payments, shipping, receiving, and evaluation are completed, achieving a closed transaction loop.

**Supply Chain Collaborative Service Model B2B E-commerce Helps SMEs Achieve Online-Offline Synergistic Development**
The broad supply chain includes procurement, production, inventory, sales, and after-sales delivery, as well as collaborative services related to these services. Its advantages lie in the accumulation of mature supplier and customer relationships, a sound service system, and other resources.

iResearch analysis believes that for SME B2B e-commerce, the core of the supply chain lies in online-offline synergistic development. Warehousing and logistics are based on offline scenarios, while the improvement of supply chain efficiency and operational capabilities depends on the development of online finance, big data, and cloud computing.

**Application Software Service Model Provides Technical Support for Bulk Commodity Trading B2B E-commerce Development**
Application software services use general SaaS to solve enterprise pain points in different functions such as human resources, sales, and finance; vertical SaaS helps vertical industries improve efficiency.

Typical representative enterprises include: Qianmi.com, D1 Commerce, Renmaitong, Tencent Enterprise Mail, etc.

**Alibaba - Leading Enterprise in SME B2B E-commerce**
**Strong Brand Advantage and Global Resources**
Alibaba started with domestic trade, mainly focusing on information display; it owns Alibaba International Station and 1688, with Alibaba International Station targeting the international wholesale market and 1688 targeting the domestic wholesale market. In 2015, 1688.com officially launched the global sourcing platform, becoming an important part of the group's cross-border import strategy, connecting the intermediate chain between overseas origins and Chinese retailers.

**HC360 - B2B Platform Exploring Business Innovation**
**Vigorously Developing Supply Chain Finance Business, Improving the Ecosystem**
HC360 is a leading domestic trade B2B e-commerce enterprise in China. It uses advanced Internet technology to provide professional information services for SMEs, build a reliable supply and demand platform, and provide comprehensive business solutions.

In recent years, HC360 has actively explored transformation and upgrading, making positive explorations in online transactions, financial logistics services, mobile terminals, and vertical field layout.

**Yihuobaiying - Raw Material Procurement B2B Platform**
**Integrating Raw Material Resources, Improving Efficiency, Reducing Costs**
Yihuobaiying serves manufacturing SMEs, committed to connecting the upstream and downstream of the procurement supply chain. This model directly targets the gray areas of enterprise procurement, greatly reducing procurement costs, improving operational efficiency, and creating greater profits for enterprises.

**Yihuobaiying Committed to Building a Manufacturing Ecosystem Platform**
**Focusing on Ecosystem Clusters, Becoming an Industrial Big Data Provider**
In the era of Industry 4.0 and supply-side reform, professional industrial ecosystem clusters will become more and more specialized. The characteristic industrial ecosystem clusters of "1 city, 1 characteristic industry" and "1 town, 1 product" will increasingly become the key to urban competitiveness. The ecosystem cluster around the industrial supply chain is the key guarantee for manufacturing efficiency. In the future, Yihuobaiying will focus on three aspects: industrial ecosystem platform, manufacturing big data, and supply chain finance, forming an industrial ecosystem cluster, thereby reducing enterprise costs and enhancing competitiveness.

**Zhaogang.com - Leader in Vertical B2B E-commerce**
**Transforming the Steel Circulation Trade Model, with Obvious Professional Advantages**
Zhaogang.com greatly shortens the traditional transaction chain of "steel mill - large agent - middleman - retailer - end user", achieving model innovation from "steel mill - retailer" and "large agent - retailer", significantly improving supply chain efficiency.

**SME B2B E-commerce Deepens Supply Chain Needs**
**The Ability to Provide Comprehensive Services Will Be the Future Competitive Point**
A complete B2B e-commerce ecosystem includes information flow, logistics, and capital flow. After the integration of internal management systems within SMEs, cross-enterprise collaboration is crucial, achieving docking with e-commerce big data.

iResearch analysis believes that in the current stage and foreseeable future of B2B e-commerce, competition among B2B enterprises will no longer be about the amount of platform information, but rather the ability of e-commerce as an ecosystem to provide comprehensive services. Providing comprehensive services is one of the future development trends for SMEs.

**SME B2B E-commerce Further Integrates Online and Offline**
**Accumulating Customer Resources, Improving Additional Services**
The greatest value of online-offline integration is to further enhance the transparency of resources between supply and demand sides in the industry, achieve effective docking between supply and demand, and provide the possibility for the healthy development of the B2B industry. E-commerce B2B platforms represented by Yihuobaiying play an important role in optimizing the upstream and downstream of the industry chain and establishing e-commerce industry belts with regional characteristics.

iResearch analysis believes that the penetration of Internet technology has promoted the birth of new business models, achieving efficient docking from factories to B-end customers. In the future, online-offline synergistic development and building a complete B2B industry ecosystem will be the general trend.

**SME B2B E-commerce Develops Steadily, Especially Upstream Near-Production-End E-commerce Will Gain More Opportunities**
On the one hand, supply-side reform provides good policy support for the transformation of traditional industries, which will greatly drive the development of near-production-end B2B e-commerce; on the other hand, the transformation and upgrading of traditional manufacturing has strong demand for B2B e-commerce focused on the production end.

iResearch analysis believes that bulk commodity trading B2B e-commerce near the production end will have greater development in the future.

**SME B2B E-commerce Models Continuously Innovate**
**Achieving Diversified Development**
Currently, most SME B2B e-commerce platforms in China adopt the matching transaction model, starting from information flow, through manual or systematic matching, to facilitate procurement and supply transactions. With the development of the B2B industry, based on the matching transaction model, some innovative models have emerged, mainly including: search entry, capital flow entry, warehousing entry, and platform consignment.

iResearch analysis believes that different models can coexist in the same industry, and the same platform may evolve from one entry point to another. Enterprises should choose the corresponding B2B development model at different development stages based on their own business characteristics and resources. In the future, model innovation will become a major trend in SME B2B development.

## **Concept Definition**
• B2B e-commerce refers to a business model where enterprises conduct data and information exchange and transactions through dedicated networks or the Internet.
• iResearch Consulting divides B2B e-commerce into SME B2B e-commerce and above-scale B2B e-commerce. The B2B e-commerce transaction scale is the sum of SME B2B e-commerce transaction scale and above-scale B2B e-commerce market transaction scale. Among them, the SME B2B market transaction scale is the sum of domestic trade transaction scale and foreign trade transaction scale.
• This report mainly studies SME B2B e-commerce.

## Business Classification
• SME B2B e-commerce can be divided into B2B e-commerce providing bulk commodity trading services and B2B e-commerce providing non-physical product services based on the content of transactions between buyers and sellers.
• Among them, B2B e-commerce providing bulk commodity trading can be divided into near-production-end e-commerce and near-consumption-end e-commerce; B2B e-commerce providing non-physical product services can be divided into e-commerce providing software services and e-commerce providing other services.

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