Unlocking B2B E-commerce in Argentina with Open Commerce Technology

Argentina’s e-commerce market, which is the fourth-largest in the LATAM region, has experienced rapid growth over the last few years, with total e-commerce revenue growing by 87% from 2021 to 2022. This growth, alongside the high rates of mobile and internet penetration in the country, suggests a strong potential for continued e-commerce expansion in the region, as 64% of the population is expected to shop online by 2027, up from less than half in 2018.

Against the backdrop of this opportunity, RedCloud’s General Manager, Juan Etchevery, recently attended an event hosted by the Cámara Argentina de Comercio Electrónico (Argentine Chamber of Electronic Commerce) (CACE) Technology Commission and delivered a presentation on the future of B2B e-commerce in Argentina. 

In this article, Juan shares some key insights and takeaways from the event, with a focus on the current state of B2B e-commerce, the challenges that Argentine retail businesses in Argentina face and how Open Commerce can help solve these challenges and drive significant, sustainable growth.  

B2C e-commerce is growing in Argentina

Every year, the CACE, in partnership with Kantar, releases a study on the state of e-commerce in Argentina. At the event, the conversation was dominated by the findings from the latest study, which was released in 2023 and painted a picture of a vibrant and growing e-commerce landscape.

The study showed that in 2023, over 1.4 million new consumers shopped online for the first time, bringing the total number of e-commerce consumers to a little over 23.247 million. The total sales volume also mirrored the growth in digital consumer activity, with more than 489 million products sold across 234 million transactions – a 16% and 11% increase from 2022, respectively. This growth also had a significant financial impact, with the industry turnover soaring by 175% to reach a total of $7.8 billion Argentine pesos (about $9 billion USD).

Happy man working at a grocery store doing the inventory - small business concepts

According to the study, the most popular e-commerce category in 2023 with the highest volume of products sold were tickets to shows and events, with sporting and non-sporting clothing coming in second and third, respectively. Mobility & transportation and food & drink rounded the top five most popular e-commerce categories, coming fourth and fifth, respectively.

The CACE Technology Commission also shared its vision for a comprehensive digital ecosystem map, which is under development. This initiative aims to provide a single, accessible resource where all key players in the e-commerce space—vendors, suppliers, agencies, and platforms—can be easily located and connected. 

However, despite the remarkable advancements in consumer e-commerce, participants and speakers at the event noted that the B2B e-commerce segment is still playing catch-up. While more consumers can buy products online, many businesses are yet to fully embrace or benefit from similar digital efficiencies in their transactions. 

B2B e-commerce still lags behind

In Argentina, there is a noticeable gap between the digitization of B2C and B2B commerce, as much of consumer goods trade still depends on traditional, offline trading processes. This gap is particularly evident in the FMCG and retail sectors, where cash-based transactions, manual inventory management, and a lack of visibility across the supply chain are common, and the entire trading process is untouched by e-commerce technology.

Juan highlighted this issue during his presentation at the CACE event, noting that there has been no major change in how businesses source, buy and pay for consumer goods across the market, despite the advancements in e-commerce technology. He also noted that the lack of innovation and inefficiency in the B2B commerce space has caused the prices of consumer goods to remain high, as brands, distributors and vendors still have to go through the decades-old traditional offline supply chain.

High angle view of a warehouse manager walking with foremen checking stock on racks. Businesswoman discussing stock with a male worker while walking by racks in warehouse.

It was also noted that the existing structure of the e-commerce landscape in Argentina predominantly favors a few large platforms. These large platforms, such as the e-commerce giant Mercardo Libre, operate under a ‘winner-takes-all’ model, which enables them to effectively monopolize retail channels and exert considerable control over market dynamics. The dominance of a few e-commerce platforms also contributes to the ever-rising prices of consumer goods, as these platforms typically operate with high margins and even launch their own white-label products in categories with high volume or profitability. This approach leaves both brands and vendors vulnerable, as vendors are systematically excluded from the benefits of online trading, and brands are forced to either stick with the outdated, inefficient offline supply chain or relinquish control over their entire supply chains to sell on e-commerce platforms.

The Argentine B2B E-commerce space needs Open Commerce

Female owner working at supermarket. Saleswoman is taking inventory in store. She is wearing apron.

Argentina’s B2B consumer goods sector needs a new e-commerce model that will digitize the long-tail retail supply chain and offer businesses. Juan, in his presentation, spoke about the need for a “one-stop shop” that provides brands and vendors with the same level of choice, convenience and cost efficiency that B2C e-commerce provides to end consumers. The solution the market needs is Open Commerce. This new type of e-commerce model is designed to open up the market and digitize existing traditional supply chains rather than attempt to replace them. RedCloud is already making this a possibility with it’s AI-powered Intelligent Open Commerce Platform that directly connects brands, distributors, retailers and vendors on a single platform, unlocks the supply chain and brings the convenience and efficiency of e-commerce to businesses. 

He also shared how RedCloud is helping solve some of the biggest problems businesses face with digital selling, which are logistics and last-mile delivery, and they are solving that by building on the existing logistics ecosystem and partnering with third-party logistics companies who already have the trucks and the routine. This is especially important when bringing B2B e-commerce to smaller sellers and retailers outside major cities like Buenos Aires.

It was also noted that there is a cultural aspect to consider. More than just a technological solution, transitioning to digital platforms requires a shift in mindset among retailers and sellers. RedCloud has recognized this and actively works to facilitate this shift through a dedicated team of field officers. These professionals engage directly with retailers, educating them about the benefits of Open Commerce and how it can revolutionize their business operations.

To learn more about Open Commerce and how it’s unlocking B2B e-commerce for millions of brands, distributors and retailers in Argentina, visit www.redcloudtechnology.com/contact