— This is the script of CNBC's news report for China's CCTV on April 29, Wednesday.
As pressure from Wall Street continues to mount for Amazon to get to profitability, the company is launching an expansion of it's old Amazon Supply marketplace and now calling it "Amazon Business."
The online marketplace now encompasses hundreds of millions of products, according to Amazon from products such as IT and lab equipment to education and food services, small businesses sign up for a free account and get free two-day shipping on products. Amazon touts new functionality such as integrating purchase orders with accounting systems and credit terms as well as an Amazon Corporate Credit Line as features small businesses are looking for. While the marketplace is not necessarily new, it marks yet another move by Amazon to be everywhere at once.
CNBC's Courtney Reagan explains.
AMAZON COMPETES IN A NUMBER OF SECTORS: MEDIA, RETAIL, TECHNOLOGY AND NOW IT'S MAKING ITS BIGGEST PUSH YET INTO DOMINATING BUSINESS PURCHASES...THE "B2B" SECTOR IS HUGE, VALUED AT MORE THAN $7 TRILLION.
AFTER THREE YEARS OF TESTING, AMAZON IS EXPANDING AND REBRANDING ITS "AMAZON SUPPLY" TO "AMAZON BUSINESS" WITH MILLIONS OF PRODUCTS AVAILABLE EXCLUSIVELY TO BUSINESSES BOTH IN THE U.S. AND ABROAD. BUSINESSES CAN PURCHASE ITEMS FROM PLUMBING SUPPLIES TO LAB EQUIPMENT AND FOOD SUPPLIES, SOMETIMES AT A DISCOUNT TO THE CONSUMER-AIMED AMAZON.COM
REGISTERING IS FREE, BUT ACCESS WILL REQUIRE VERIFICATION OF A TAX ID. MORE THAN ONE EMPLOYEE CAN REGISTER TO PURCHASE FOR THE BUSINESS, AND A VARIETY OF SOFTWARE FROM APPROVAL WORKFLOW TO PAYMENT SOLUTIONS AND MORE ARE ALSO AVAILABLE.
WHILE THERE IS NOT TRULY AN EQUIVALENT TO AMAZON PRIME ON ITS BUSINESS SITE, 2 DAY SHIPPING IS FREE ON PURCHASES MORE THAN $49. PRODUCTS ON AMAZON BUSINESS CAN BE SOLD BY AMAZON OR OTHER BUSINESSES.
JANNEY RETAIL ANALYST DAVID STRASSER SAYS AMAZON'S STEPPED UP INVESTMENTS TO SERVE BUSINESS CUSTOMERS CONTINUES TO HURT OFFICE PRODUCT RETAILERS STAPLES AND OFFICE DEPOT, THOUGH SUBSEQUENTLY PROVIDE COMPETITIVE EVIDENCE IN SUPPORT OF THE PROPOSED STAPLES-OFFICE DEPOT MERGER.
Globally, by 2020, the B2B ecommerce market will be twice as large as the B2C market - $6.7 trillion vs. $3.2 trillion - according to research provider Frost & Sullivan. The company predicts that China will emerge as the largest online B2B market with $2.1 trillion in sales by 2020.
In the U.S., where B2B ecommerce is already twice as large as B2C ecommerce, Forrester Research expects B2B ecommerce sales to reach $780 billion and represent 9.3 percent of all B2B sales by the end of 2015. The firm predicts that B2B ecommerce will exceed $1.1 trillion and comprise 12 percent of all B2B sales in the United States by 2020. The firm forecasts a compound annual growth rate of 7.7 percent in B2B ecommerce over the next five years, resulting from the need by B2B companies to reduce their costs.
The entry of ecommerce giants such as Alibaba and Amazon into B2B has accelerated the trend of B2B websites becoming more like B2C.
CNBC's Qian Chen, reporting from Singapore.