Effective Cross-Border Payments & Trade Strategies: B2B and B2C

Tips, strategies, and ways for cross-border payments and trade for B2B and B2C companies.

Business-to-business (B2B), refers to business transactions between companies, such as between manufacturers and retailers or between wholesalers and retailers. On the other hand, Business-to-Customer (B2C) involve businesses that sell their products directly to their end-product users for their goods and services.

Cross-Border Business for B2B & B2C Companies
XanPay - Effective Cross-Border Payments & Trade Strategies: B2B and B2C

Cross-border business or cross-border e-commerce is best described as companies doing business together between different countries. Every aspect of business-like communication, payments, and products happens between two sides of the border. This trade happens between companies (B2B) or between a business and a consumer (B2C). Many aspects need to establish for conducting cross-border business operations including payments, shipping, warehouse facilities, etc.

Cross-border payments involve a payee and a seller from two different countries, and with the rise in online commerce, cross-border commerce is here to stay. As reported by McKinsey, towards the end of 2020, cross-border payments revenue was estimated to be around $1.9 trillion. In the B2B and B2C sectors, sellers and buyers must trade with institutions that allow payments and transactions across the border.

Cross-border e-commerce started from eBay in 2006 as the US market worked on looping in the Chinese consumers to B2C and has been growing into the rest of the world ever since. Due to the recent pandemic, B2B and B2C cross-border trading has become crucial and grown at an unprecedented rate. Brands had to resort to cross-border trade as consumer demand raised from the global citizens' lockdown situations. This trend has become a usual way of life between business owners and consumers.

Due to today's ultra-connected world and global market, any business from any part of the world can become global, and many customers can be reached worldwide.

Depending on your location, it's best to research what companies in that region do these forms of trade and what platforms they use to accept or send payments. Recent studies have indicated that millennials' role in B2B dealings has risen regarding leadership positions, and they are exercising their authority over purchase decisions; they have taken charge. With this purview, millennials are more prone to using technological and digital methods for conducting cross-border business operations.

Here are some of the strategies and tips that you need to check for cross-border trade and payments for B2B and B2C companies.

 1. Product Quality

When it comes to B2C millennials, share the demand on products that weren’t exhibited by previous generations because of the unique perspective they have in life. They always want to feel good about any purchase they make, and this is by the product quality and the brand, and how that brand is perceived socially and globally. This leads to them sharing on social media platforms, creating a market pool for the product and services. Any company would be brilliant to involve the millennial generation in product promotion and as brand ambassadors.

2. Access digital payment solutions.

Existing payment methods can be complex and inconsistent as it involves multiple parties. The ability to make payments in the present and the future will improve the global market to great extents. The big challenge will be navigating these complexities and finding a solution to improve payment plans.

XanPay precisely provides and caters to all your needs for digital payments while conducting international payments. The process for onboarding on XanPay and accessing its technological solution is simple, fast, and easy. You can send or receive payments through XanPay's infrastructure to more than 15 countries.

3. Specialize in your customers' local payment platforms.

Since B2B is between two border companies, as a company, it would be wise to specialize in a platform like XanPay. XanPay provides tools to send payments to your vendors or business in their local payment method. This removes the hassle for businesses to convert and also eliminates extra processing charges.

4. Define your currency strategy.

As an international business, dealing with local currencies can be frustrating as they keep changing. For this matter, define your acceptable currency according to your geographical location; is it Singaporean Dollars or Indian Rupee (INR) amongst other options? Furthermore, the XanPool architecture ensures that you receive payments in your preferred currency directly in your bank account.

5. Get familiar with CHIPS and SWIFT.

Chips and swift are codes used in global payment processes. They are beneficial for huge transactions in B2B, and they quickly recognize the clients' bank as they receive and make international payments.

6. Reduce cross-border transaction fees.

Global payment fees constitute a significant barrier in a transaction for either B2B or B2C. Since significant international transactions are carried out by banks and have to pass through multiple parties, it is super expensive. XanPay facilitates businesses to lower their transaction fee costs from as high as 7% with conventional financial infrastructure to less than 2%.

A reduction of fees could be a big help in trade; also, both parties have started to consider non-bank global payment systems like Cryptocurrencies due to the rise in technology. To send or receive money through cryptocurrencies, you can consider using a service such as XanPool.

7. Compliance

Lastly, comply with global payment laws either as a company or a consumer. Cross-border companies need to comply with the laws of both their countries' countries, their own, and their clients.

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