The company’s financial gains reversed recent quarterly declines, as Bodor noted that Protolabs did well in Q3 despite continued softness in manufacturing markets.

Robert Bodor, president and CEO, Proto Labs Inc.

“We continue to accelerate innovation for customers with the fastest and most reliable lead times in the industry,” Bodor said on a Q3 earnings call. “The broader economic environment is still uncertain. Manufacturing conditions in the U.S. and Europe remain soft and have not consistently improved throughout 2023.”

Protolabs revenue in Q3

Despite that economic downturn, Protolabs “grew in the quarter, especially in our digital manufacturing network business,” he said.

Bodor added that Protolabs is gaining market share with larger companies and expanding in new markets.

“Recently, a luxury high-end automotive manufacturer selected Protolabs to assist with its first foray into the electric vehicle market,” he said, without naming the manufacturer.

Bodor added that Protolabs worked with vehicle manufacturer’s design firm, Hutchinson, to make prototypes for and electric vehicle battery pack cooling system.

“We rapidly manufactured injection molded parts, which meant stringent project timelines and quality utilizing our speed, reliability and quality,” he said.

Bodor noted that Protolabs’ traditional business over most of its 24-year history has been in manufacturing prototypes of parts that customers use in designing and testing new products. But it is now seeing growing demand for parts that customers use in the production of final products.

Protolabs “is becoming a one-stop shop for custom prototypes and low-volume production,” he said.

Protolabs’ services include:

• Injection molding
• 3D printing
• Sheet metal
• CNC machining

CNC machining is a manufacturing process in which pre-programmed applications dictate the movement of factory tools and machinery. The process enables three-dimensional cutting tasks to be accomplished in a single set of prompts.

Protolabs reported for the third quarter ended June 30:

• 23,800 product developers served by its digital manufacturing.
• Gross profit of $59.28 million, for a gross margin of 45.4%. That’s up from $53.6 million and 44% a year earlier.
• $19.5 million in earnings before interest, tax, depreciation and amortization (EBITDA) or 14.9% of revenue. That’s up from $11.4 million and 9.3%.
• Net income of $7.95 million, up from $3.95 million.

For the nine months ended June 30:

• Revenue of $166.18 million, nearly unchanged from $166.85 million a year earlier.
• Net income of $10.32 million, down from $11.60 million.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s Protolabs update.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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Crocs Inc. (No. 104)

Crocs reported revenue grew 12% year over year to a record $1.1 billion in its fiscal second quarter ended June 30.

“Both the Crocs and Hey Dude brands continue to gain share and bring in new consumers with our comfortable offerings, as evidenced by DTC growth of 26% in the second quarter,” CEO Andrew Rees said in a written statement.

Crocs acquired Hey Dude Shoes in January 2022 for $2.5 billion. Hey Dude brand DTC sales grew 29.7% in the second quarter, and digital sales grew 36.7% in that time period. Total Hey Dude revenue was $239.4 million in the quarter, up 2.9%. 

Crocs were a top seller in Amazon’s Prime Day sales event, according to data from Web traffic measurement firm Similarweb Ltd. However, the retailer is facing “quite a lot of pressure” from gray market sellers on Amazon, Rees said in an earnings call.

Keurig Dr Pepper Inc. (No. 110)

Keurig Dr. Pepper reported net sales grew 6.6% in the second quarter ended June 30 to $3.7 billion. Sales growth was led by Keurig’s Liquid Refreshment Beverage category, which includes carbonated soft drinks, seltzers, and energy drinks. Dr. Pepper and Squirt were among the most popular brands, the beverage company said. Meanwhile, sales of single serving K-Cup pods were down 2.3% in the quarter.

Keurig did not share specifics about digital sales in the quarter. Digital Commerce 360 estimates online sales made up about 6% of total sales in 2022, reaching $859.5 million.

Harley-Davidson (No. 430)

Harley-Davidson’s consolidated revenue declined 2% in the second quarter ended June 30 to $1.4 billion, the retailer reported. The decline was driven by a 4% drop in revenue from Harley-Davidson Motor Company (HDMC), which sells motorcycles and related products. Part of the decline was offset by 19% revenue growth at Harley-Davidson Financial Services (HDFS), which provides financing and insurance to dealers and customers. 

The motorcycle retailer did not share specifics of online sales. However, Harley-Davidson is expanding its online marketplace of pre-owned motorcycles.

Mattel (No. 200)

Mattel net sales declined 12% in Q2 ended June 30 to $1.1 billion, the toy company reported. The retailer attributed the decrease to declines in the toy industry as a whole, with the expectation that consumers are waiting to make purchases for the holiday season, CEO Ynon Kreiz told investors. 

Following the release of the Barbie movie, Mattel entered 165 product partnerships in thousands of stores, Kreiz said. So far, toys and products related to the film have sold out across distribution channels, Kriez says. Mattel did not share specific figures on digital sales. Mattel president and chief operating officer Richard Dickson was recently appointed as chief executive officer to Gap Inc. (No. 20), effective Aug. 22.

Overstock.com Inc. (No. 50)

Online home furnishings retailer Overstock said revenue was down 20% year over year to $422 million for the quarter ended June 30, 2023.

The online furniture retailer completed its acquisition of competitor Bed Bath & Beyond in June for $21.5 million. Read more coverage of Overstock’s quarterly earnings here.

Tractor Supply Co. (No. 97)

Tractor Supply net sales grew 7.2% year over year in the second quarter $4.18 billion. Comparable store sales grew 2.5% over the period, which ended July 1.

The retailer announced plans to reach 3,000 U.S. locations from the current 2,164 by opening 90 new stores per year. About 30% of current stores, 700, are now organized in the Project Fusion layout, CEO Hal Lawton told investors. The retailer is adding drive-thru pickup lanes to these stores for omnichannel orders. 

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SABIC’s Specialties business unit — which produces specialty thermoplastic resins and other materials for industries ranging from aerospace to health care and water management — recently launched a storefront on Knowde.com, a marketplace that hosts thousands of suppliers and distributors.

Maureen MacDonald-Stein, director, growth OEM, SABIC Specialties

“Knowde offers another online channel for our customers to quickly find SABIC Specialties’ material options that could meet their complex performance requirements,” says Maureen MacDonald-Stein, director, growth OEM, for SABIC’s Specialties.

MacDonald-Stein notes that the Knowde storefront complements her unit’s recent launch of the SABIC Material Finder website, where SABIC customers can search and compare more than 2,000 specialty resins, copolymers and compounds. In addition, SABIC lets customers get assistance with color-matching services and order sample color chips through its ColorXpress Services.

SABIC also maintains e-business portals for Specialties and other business units and their trading partners on an SAP NetWeaver Portal platform, where users can view order and invoicing details, shipment status and technical information on products.

In 2022, SABIC reported net profit of 16.53 billion Saudi riyals ($4.41 billion) on sales of SR 198.47 billion (US$52,92 billion).

Harcros Chemicals caters to online buyers

Harcros Chemicals Inc., an employee-owned chemical distribution and manufacturing company, also recently opened a Knowde storefront featuring more than 350 products for the industries including agricultural, water treatment, oil and gas, personal care, paints and coatings, and adhesives.

“Increasingly, formulators, R&D professionals, and procurement teams are searching for the products they need online,” says Jared Reigle, director of marketing for Harcros.

Knowde says that companies selling on Knowde activated more than 6,000 storefronts last year, bringing its total then to over 8,000.

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So as a prominent tire supplier to Canada’s automobile manufacturers, dealers, and independent tire retailers, Montreal-based distributor Groupe Touchette Inc. has relaunched its ecommerce platform to meet the demands of multiple B2B channels and individual consumers.

Denis Gallagher, vice president of IT, Groupe Touchette Inc.

The company’s new ecommerce platform, running on SAP Commerce technology from SAP SE, hosts several transactional commerce sites, including TireLink.ca for sales to motor vehicle manufacturers and their dealers; DTTire.ca for independent tire dealers and installers; and Tireland.ca, where consumers can purchase tires and arrange for professional installation.

Groupe Touchette says 94% of customer orders are now placed through the ecommerce site, up from less than 80% on its prior site.

Operating online with more agility

“The tire distribution industry has seen significant shifts in recent years, including the emergence of private label tires, and advanced use of data, analytics and technology logistics,” says Denis Gallagher, vice president of IT. “Since the establishment of the new omnichannel B2B platform, we have been able to respond to these demands with more agility.”

As a result, he adds, “we are seeing our customer loyalty, competitive advantage, and market share all increasing, coupled with a reduction in calls and costs to our call centers.”

Groupe Touchette also operates more than 50 distribution centers throughout Canada, putting it “in a position to offer delivery services in 90 of the 100 largest cities in the country in less than three hours,” Gallagher says.

The distributor’s overall sales and fulfillment operations, however, require reliable connections to exchange customer and product data between its ecommerce platform and backend business operations software.

Integrating ecommerce with ERP

Groupe Touchette worked with Toronto-based systems integrator Pivotree to deploy SAP Commerce and integrate it with the distributor’s SAP S/4HANA enterprise resource planning software, providing for accurate online presentation of such content as customer contract pricing, order details and status, customer activity data, and promotions.

Among other improvements, the ecommerce platform also features enhanced site search and navigation, resulting in more repeat customers and fewer calls to customer service, Gallagher says.

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Scott Dushane, director of IT, Fairmount Tire & Rubber

“One of our biggest differentiations is when we answer the phone, it’s on the first couple of rings, every single time,” says Scott Dushane, director of IT.

But while that helps build personal relationships with customers, it’s not a scalable-enough business strategy to meet Fairmount’s goals. And those goals are ambitious — like providing an Uber Eats level of a transparent order and delivery service.

“Just like you can now go to Uber Eats, order a burrito, then know the driver’s name that’s going to pick up that burrito and then hand it to you in exactly 23 minutes, we want that same experience to happen for wholesale tires,” Dushane says.

“It’s a much less sexy industry, but the genie’s out of the bottle — we need to provide the same level of service and supply chain transparency that Uber is providing.”

Making strides in service and sustainability

Fairmount Tire & Rubber primarily serves the four-state region of Arizona, California, Nevada and Utah. It uses its home-grown self-service ecommerce site integrated with an online delivery management system to improve and expand its business. At the same time, it is drastically cutting out paper documents, increasing its sustainability and operating efficiency, Dushane says.

He says Fairmount is making significant strides in upgrading how it engages B2B customers online, matching buyers with the particular tire SKUs they need from a long list of options — such as the many tire brands, sizes, and applications like tread patterns for different types of weather — and providing transparency in deliveries, including same-day service.

Fairmount uses an online delivery management system that has streamlined and expedited the distributor’s delivery system and lets customers know through a GPS-based mobile app what tires are coming and when.

The delivery management system, from Descartes Systems Group, integrates through Google Cloud with Fairmount’s digital commerce platform and other technology systems and applications, including enterprise resource planning, product information management, customer relationship management and warehouse management.

Dushane says that, until recently, the most common call Fairmount’s agents received was “Where’s my tires?” But with the new system, Fairmount can replace those inbound customer service calls with outbound sales “rainmaker” calls often made by the same agent.

“This is real money,” he says.

No more shuffling paper for invoices

The old system had relied heavily on paper documents about customer orders and available delivery trucks, resulting in a difficult process for planning order fulfillment and delivery.

“For many years, it was a stack of papers on someone’s desk. And you would do the old shuffle and figure out how to route and how to build trucks,” Dushane says.

Fairmount now uses its integrated ERP, order management and delivery management systems to automatically coordinate how orders are delivered with the most efficient use of trucks and routes, he adds.

“It is an unbelievably difficult problem to route trucks throughout a city, like mathematically,” he says, adding, “Descartes comes up with sort of magical solutions that [we] never came up with for the last 30 years of running the same routes.”

As customer orders come into Fairmount’s B2B ecommerce login customer portal, at b2b.fairmounttire.com, the tire distributor’s financial software generates electronic invoices that the delivery management system allocates to delivery trucks based on their availability and capacity.

One advantage of the new system is replacing a system that used to require three sheets of paper for each invoice. When drivers make deliveries, they use mobile devices stored with order details and e-invoices to receive customers’ digital signatures and generate delivery confirmation notes.

“We totally eliminated paper,” Dushane says.

Reworking delivery routes for more service and sales

In addition, Fairmount speeds up deliveries by using its software to arrange multiple orders on the same truck in a way that makes them faster to unload at each customer’s destination.

And that has opened the door to more sales opportunities as well as greater efficiency, Dushane says.

“We have been able to start to run second and third routes because of Descartes … because we know when the drivers will be coming back and what the trucks can be filled up to — there’s no obfuscation,” he says.

“We have fixed costs,” he adds. “So let’s use those fixed costs to the best of our ability.”

This article is included in a special report covering B2B digital technology trends and a preview of the 2023 EnvisionB2B Conference & Exhibition.

Scott Dushane will speak during a panel and workshop on order management, fulfillment and delivery operations at the 2023 EnvisionB2B Conference & Exhibition.

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23andMe Inc. (No. 309)

Revenue was down 8% year over year for the fiscal fourth quarter, but it grew 10% to $272 million for the full fiscal year ended March 31, 2023. The biotechnology company grew its customer base 11% in the fiscal year to 14 million genotype users.

It also grew its subscription membership, 23andMe+, CEO Anne Wojcicki told investors. Subscription membership grew 51% year over year to 640,000 members. More customers are also opting in to the subscriber program with their initial purchase, though she did not give a specific figure.

Advance Auto Parts Inc. (No. 101)

Advance Auto Parts reported a “double-digit sales increase” in ecommerce for its first quarter. Over the same period, net sales grew 1.3% year over year and comparable store sales decreased 0.4%. The auto parts retailer also reported that DIY omnichannel sales grew, without sharing specifics.

Bark (No. 173)

Revenue was down 2% year over year in the fiscal fourth quarter to $126 million, coming out ahead of Bark’s guidance. Direct-to-consumer revenue also decreased 1.5% to $116 million. For the full fiscal year, direct-to-consumer revenue increased 5.3% over fiscal 2022.

Bark broke down DTC revenue by product category. Toys, beds, and apparel generated $307 million in revenue in fiscal 2023. Consumables including treats and food generated $165 million.

Best Buy Co. Inc. (No. 7)

Domestic online revenue declined 12.1% for the first quarter to $2.69 billion, Best Buy said. Online sales made up 30.5% of total domestic revenue in the quarter, down slightly from 30.9% last year. About 40% of those sales were buy online, pick up in store (BOPIS) orders, the retailer said.

Online sales have doubled since 2020, CEO Corie Barry told investors.

Big Lots (No. 251)

Net sales were down 18.3% year over year to $1.1 billion the first quarter, Big Lots reported.

“Our lower-income consumer was hurt by inflation, lower tax refunds, and higher interest rates, and their confidence has been shaken by banking failures,” CEO Bruce Thorn said in a statement.

The discount retailer declined to share specific ecommerce data.

“We continue to improve the [online] customer journey through a more curated experience, better site navigation, and eliminating friction,” Thorn told investors.

Deckers Brands (No. 167)

Direct-to-consumer net sales grew 19.5% in the fiscal fourth quarter to $343.1 million, up from $287.2 million the previous year. Much of the growth came from a few specific brands. Sneaker company Hoka net sales, including in stores and ecommerce, grew 40.3% year over year to $397.7 million. Teva sales also grew 14.6%, while Ugg sales were down 16.1%.

“Fiscal year 2023 was an exceptional year for the Deckers organization, delivering 15% revenue growth and increasing earnings per share nearly 20%,” CEO Dave Powers said in a statement. “We continue to deliver record results, including the HOKA brand adding more than half a billion dollars of top-line revenue.

Lululemon Athletica Inc. (No. 27)

Lululemon reported ecommerce sales grew 18% in Q1 over the year-ago period. Online sales contributed $835 million in revenue in the quarter, 42% of total revenue, the retailer said.

Traffic grew 30% year over year both in stores and online, chief financial officer Meghan Frank told investors. 

Macy’s Inc. (No. 17)

Online sales were down 8% year over year in the first quarter. Ecommerce sales made up 33% of total sales in the quarter, CEO Jeff Gennette told investors. Digital penetration remained flat from 2022, down from a high of 40% during the pandemic. 

Nordstrom Inc. (No. 21)

Ecommerce sales were down 17.4% in Q1 due to eliminating digital order fulfillment at Nordstrom Rack stores and closing the Trunk Club in 2022, the retailer said.

Nordstrom reported that digital sales made up 36% of net sales in the quarter, down from 39% of net sales in the year-ago period. Digital sales were approximately $1.1 billion in the quarter.

Sportsman’s Warehouse (No. 361)

Net sales decreased 13.5% year over year to $267.6 million in the quarter. Sportsman’s Warehouse didn’t provide specific information on ecommerce sales. CEO Jeff White told investors that online sales are a “continually growing highlight” of the business even as overall sales were down.

Ulta Beauty (No. 48)

Ulta comparable sales were up 9.3% year over year in the first fiscal quarter. The beauty retailer didn’t specify what percentage of sales were through ecommerce.

Ulta also finished the two-year rollout of its updated website and app in the quarter. 

Victoria’s Secret & Co. (No. 53)

Net sales decreased 5% year over year $1.4 billion in the fiscal second quarter, Victoria’s Secret reported. Web traffic for the apparel retailer remained flat from 2022, though conversion rates and average unit retail both declined over the period. 

Casual sleep and beauty were the best performing categories both online and in stores, CEO Martin Waters told investors. Sales in China showed “outsized growth in digital,” he said.

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For starters, Ritchie Bros. Auctioneers Inc. completed its $7.3 billion acquisition of Westchester, Illinois-based IAA. IAA facilitates the marketing and sale of total-loss, damaged and low-value vehicles.

Ann Fandozzi, CEO, RB Global

“The closing of the IAA acquisition represents the beginning of an exciting new chapter for Ritchie Bros. as we expect the combination of our businesses to drive long-term, profitable growth,” says Ann Fandozzi, CEO of Ritchie Bros. “With IAA, we will accelerate our transformation into a premier digital marketplace and expand into an attractive, adjacent vertical, broadening our global footprint. Our combined yard footprint, marketplace infrastructure and comprehensive suite of innovative solutions will allow us to serve customers more effectively and efficiently than ever before.”

In tandem with the closing of its cash and stock deal for IAA, which auctions damaged and repairable vehicles, theft-recovered vehicles, vehicle parts and donation vehicles, Ritchie Bros also changed its corporate name to RB Global.

“The RB Global name signifies the transformation of our business into a premier global marketplace and more closely aligns with our strategy,” Fandozzi says.

Accelerating growth bey0nd auctions

“Over the last several years, we have worked to create a new growth platform that extends beyond auctions by building out our suite of solutions, enhancing our technology offerings and expanding our real estate footprint,” Fandozzi says. “The IAA acquisition accelerates these efforts, adding significant scale, reach and capabilities. As one company — RB Global — we have a unified vision for success and value creation.”

RB Global also reported higher gross transaction volume, revenue and a net loss for the first quarter ended March 31.

The company reported Q1 gross transaction volume of about $1.90 billion. That’s a 32% increase from $1.44 billion in the prior-year quarter. Revenue increased year over year by 30% to $512.4 million from $393.3 million.

The company reported a net loss of $28.2 million, compared with net income of $178.1 million in the year-earlier quarter. It attributed the net loss partly to acquisition-related and integration costs.

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The new Digital Commerce 360 report, “B2B Ecommerce Handbook: Formulas for Digital Growth,” lays out many of the steps businesses are taking, from identifying customer needs to managing useful product and customer data and providing a user-friendly, personalized buying experience — and growth in sales to boot.

Case studies in the B2B Ecommerce Handbook

Enzo Rabante, head of digital solutions, Dayco

At Dayco, an international engine parts manufacturer for various industries, “Our customers expect a personalized journey that generates value at each touchpoint, enhancing the brand in every line of business,” Enzo Rabante, head of digital solutions, says in the report.

To reach that point, Dayco gathered specifics on what its distributor customers wanted in an online buying experience, including quick access to product pages and related technical documents. It also determined the kind of customer experience it needed to provide and laid out the key performance indicators it wanted to reach, such as increased conversion rates for marketing campaigns and levels of customer loyalty.

Fine-tuning the B2B marketplace model

Also featured in the report are fast-growing chemicals marketplace ChemDirect and GearSource, a live-events gear supplier.

Dave Haase, president, ChemDirect

As B2B marketplaces expand in number and volume to serve every industry, the companies building and operating them are perfecting their strategies.

ChemDirect, a marketplace for the chemicals industry, last year expanded its catalog to more than 500,000 specialty chemical products. It’s on course this year to triple gross merchandise value to between $40 million and $50 million.

President Dave Haase notes that ChemDirect is backing that growth by addressing two critical needs of chemicals industry buyers: pricing transparency and, through a shipping network developed with trucking company Schneider National, more control over their shipping.

Marcel Fairbairn, founder and CEO, GearSource

If you’ve viewed a Super Bowl half-time show recently, you’ve seen the kind of results provided by GearSource.com, a supplier of lighting, audio and related equipment for live events and clients like Google and Apple.

Recent plans to tap expanded growth opportunities led GearSource to replace its long-running legacy ecommerce platform with a new one capable of handling transactions of complex orders, many of which involved multiple currencies.

Founder and CEO Marcel Fairbairn says the new platform gives GearSource the necessary speed and flexibility to grow and keep its customers’ events on stage and under the lights.

The B2B Ecommerce Handbook: Formulas for Digital Growth report is available for a free download.

Dave Haase, president of ChemDirect, will speak B2B marketplace strategy at Digital Commerce 360’s EnvisionB2B 2023 Conference & Exhibition in June in Chicago.

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Kathleen Lewarchick

“Visual commerce,” or online buying that uses 360-degree image views, interactive 3D models, and in some cases, augmented reality, has made the jump to B2B ecommerce. Introduced by the gaming world, visual commerce became more mainstream when B2C brands began offering enhanced visual experiences. Think eyewear retailing, where consumers “try on” frames, or furniture buying, where buyers preview products in their virtual home. It was only a matter of time before those experiences appeared in B2B.

How visual commerce helps B2B buyers

Buyers look for clarity as they step through an online customer journey. Ordering and reordering can be straightforward, but increasingly distributors and manufacturers have turned to “solution selling” of interconnected products using a visual approach. Buyers appreciate seeing a more fully integrated list of materials. It removes the guesswork and saves time. Sometimes it even saves them money.

In some categories, visual commerce provides wholesalers (and even their consumers) with engaging experiences. It might be a virtual showroom with curated collections that support full online buying. Other times it is a mixed-use tool, a digital assist: buyers peruse fixtures and materials in a real showroom and place items in an online cart, on a device, as they shop. This can save buyers time and it can be a wonderful way to cross-sell them throughout the customer journey.

New technology tools

One tool — exploded-view diagrams, or schematics showing parts together — was a mainstay for engineers. But they are more common now throughout B2B ecommerce.  Buyers can now see the entire solution, both holistically and individually, and order with them. Per the parts diagram below, the exploded view integrates with the order management system. See a part that you need? Check. See the whole solution? Check, check. In either case, just click and place it in the cart.

An exploded-view diagram, which is becoming more common in B2B ecommerce, lets buyers view and click to buy individual parts of complex equipment.

One B2B company incorporated this technology into their user experience flow. The goal was twofold:

1. to make it easier for B2B sellers in their organization to explain larger, integrated solutions; and
2. to make it easier for their customers, B2B procurement teams, to visualize the outcome.

By creating an integrated visual tied to the company’s order management system, they reduced steps in the customer journey. As the ecommerce manager says, “There’s a wonderful moment when buyers say: ‘Aha! I see how it all works.’ We want to delight and relieve buyers during the process.”

While not all B2B categories are a match for transactional visual commerce, other augmented reality tools are on the cusp of changing the way that overall B2B business performs. Again, driven by experiences in gaming, buyers like MRO (maintenance, repair and operations) engineers can now don A/R headgear or use tablets to “see” solutions in their natural environment.  As a result, they may uncover potential barriers earlier in the buying process, maybe even prior to ordering. This accelerates the knowledge build and helps save time and money with returns.

MRO engineers use visual commerce to view products in their natural environment before placing an order.

Preparing for the future

Visual commerce may never fully replace traditional ecommerce, just as “voice commerce” hasn’t become the dominant way to place B2B orders yet. However, visual commerce will continue to be incorporated into many facets of B2B digital commerce given the appetite that online users have for strong visuals. A great place for your organization to start is with a strategic discussion about use cases. These provide the foundation alongside good product data, and with technologies like Digital Asset Management systems, you evolve toward the Visual Commerce experiences that your customers increasingly expect.

About the author

Kathleen Leigh Lewarchick is the VP of Marketing for Xngage LLC, a B2B digital commerce services company with more than 60 clients across the industrial trades. She is the former PURELL® Hand Sanitizer Brand Director, has co-created automated replenishment products with Amazon Business, and created telehealth solutions for a company that she later helped sell to CVS Health. 

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Dave Haase, president, ChemDirect

One fast-growing example is marketplace ChemDirect. The B2B chemicals marketplace kicked off online marketplace sales transactions in 2019 and is on course to triple gross merchandise volume to about $40 million by the end of 2023 over 2022, president Dave Haase says.

For an industry that is still new to ecommerce, several chemical marketplaces are emerging with strategies designed to set them apart and foster connections with buyers and sellers. At ChemDirect, the marketplace is taking a multi-pronged approach that in the past year has expanded its user base with such organizations as Sun Chemicals, 3C Labs, Tyson Foods, Johns Hopkins University and the University of Southern California.

To prod its growth, ChemDirect — backed by more than $10 million in funding from investors including logistics company Schneider National Inc. and the TitletownTech joint venture of Microsoft Corp. and the Green Bay Packers — last year expanded to more than 500,000 specialty chemical products and brought its number of suppliers to 130.

Operating out of Green Bay, Wisconsin, office space shared with TitletownTech across from the Packers’ famed Lambeau Field, ChemDirect also doubled its number of buyers to more than 1,000 as it improved the online customer experience with new services. Its chemical markets range from agriculture and automotive to food and healthcare.

Displaying off-contract chemical prices

To make it easier for buyers to see the base prices of the chemical products that ChemDirect makes available, the marketplace takes the unusual step of displaying those prices on its public-facing product pages — rather than the more common approach of only showing contract pricing on password-protected customer account pages.

“You’re not providing value for the person on the buy side of the transaction unless you’re giving them all the information they need to buy,” Haase says, adding, “That’s actually the purpose of a marketplace.”

Haase adds that about 80% of ChemDirect’s orders initially come through its listed prices, but that many of those customers go on to place bulk and recurring orders under contracts. “About 20% of our orders, and 70% of our rveenue, go through bulk or recurring purchases,” he says.

ChemDirect, also offers a range of payment and financing options through ChemPay, an online program offered by financial technology and services firm Balance Payments Inc. For its ecommerce technology, ChemDirect uses Adobe Inc’s Magento platform.

ChemDirect moves in new directions

In a move to serve a complementary market to chemical suppliers and buyers, it launched the ChemExchange portal for selling overstocked inventory.

ChemDirect’s growth strategy also extends to order fulfillment and logistics, addressing the challenge chemicals buyers face in hiring carriers and shipping chemicals expeditiously and according to transportation and safety regulations. ChemDirect launched with Schneider last year a chemicals shipping network that assists companies with lining up carriers certified and capable of carrying chemical loads.

Schneider is building out a network of carriers that handle chemical transport, and ChemDirect is developing technology designed to let ChemDirect users to plan their shipments. Haase says the freight service, combined with the online purchasing experience, is designed to significantly reduce the amount of time it takes to procure chemicals and arrange for shipping – from weeks to an instant transaction.

“We want to bring that into a real-time experience, very similar to what you would see as a consumer when you shop online,” Haase says.

Skip Laubach, president and COO, Vertec BioSolvents

Skip Laubach, president and chief operating officer of chemicals supplier Vertec BioSolvents, a supplier of non-petroleum-based industrial solvents, says that ChemDirect’s overall marketplace strategy is helping it to expand Vertec’s business.

“ChemDirect enables us to reach customers like never before and at no additional cost,” he says in a ChemDirect press release. “We’re also saving time and administrative costs on customer service, coordination and shipping.”

Speaking at EnvisionB2B 2023

Haase will speak on a panel about marketplace strategy at the EnvisionB2B 2023 Conference & Exhibition in June in Chicago.

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