Shopify Plus: the platform that offers custom themes, faster checkout, and unlimited transactions now offers more. Shopify Plus has now revamped B2B –   and it’s highly competitive. B2B sellers can now look forward to a special checkout that shows wholesale pricing, net payment terms, and customer accounts. Here are some ways you can prepare your business for the transition. 

Determine Wholesale Pricing in Advance 

If you’re new to B2B, there are a lot of new terms and ideas that you need to define for your business. One is wholesale pricing, or the price you charge other businesses to buy your product in bulk. There are many things to take into consideration when pricing your product for wholesale, and there are many different ways to calculate your price. You should consider:  

  • Defining your business’ target market
  • How much does it cost you to produce your product? 
    • Total material cost + total labor cost + additional cost and overhead = cost of goods manufactured
  • What do you want your retail margin % to be? 
    • Retail price – cost / retail price = retail margin % 

Once you take these considerations into account, you are ready to find the formula to determine the wholesale price that works best for your business. Some of the most popular formulas are: 

  • Absorption pricing
    • Considers all prices in the final price 
      • Cost price + profit margin = wholesale price
  • Differentiated pricing
    • Optimizes return on investment by changing the price to match the demand (higher prices during higher demand) 
      • Wholesale Price / (1 – Markup Percentage) = Retail Price 
  • Dual Pricing 
    • Allows you to sell B2B and DTC at different prices, no specific formula 

Determine Net Terms in Advance 

Net terms are used frequently in B2B, but if you’re new to B2B, you might not be familiar. Net terms are contracts between businesses that allows a business to buy from another and pay for it at a later date. The most common net terms include net 15 (pay for in 15 days), net 30, and net 60. It is important to note while you are considering what net terms to use for your business that you will not be paid for your goods until the net term is up.  There are some challenges in net terms, including:

  • Businesses paying late 
  • Cash flow issues in the interim 
  • More work for accounts receivable 

Net terms can also be beneficial, as they encourage businesses to buy. Plus, you can incentivize by adding a discount when the amount is paid before the term is up. 

To determine your net terms, you need to consider: 

  • If all clients will get the same terms 
  • If you want to offer a discount on early payment 
  • How you will respond to late payments 
  • If you want to offer better terms to loyal clients

Other Ideas to Keep in Mind

While wholesale pricing and net terms are the most important things to establish before you begin your journey, there are some other ideas to keep in mind. You should think about if you want to offer a price list, which offers special rates to selected clients. Also consider if you want to offer multiple currencies, allowing businesses to purchase in their local currency. However, these are decisions you can make after you settle into your business, as Shopify makes it easy to change over time as your B2B grows. 

What Happens Next?

You’ve put in the work, determined your wholesale pricing and your net terms. You’re ready to start your B2B journey. But how?

First, if you don’t already have a Shopify Plus account, reach out to a partner like Fyresite to ensure it’s the right fit! The Shopify Plus B2B platform is highly competitive and easy to use. On top of that, if you already run a DTC business, Shopify Plus gives you the option of merging the two stores into one website or keeping your shops separate using an expansion store. 

Next, tell your customers about your exciting new change! Newsletters, social media, and direct messaging are all good ways to inform your loyal client base about your amazing new site and business. Remember, Shopify Plus B2B doesn’t only make it easier on you – it makes it easier for your customers too! 

Also, consider working with a Shopify Plus partner (such as Fyresite) to build the website of your dreams. 

To get started with Shopify Plus and Fyresite, click this affiliate link