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The Internet is transforming and reshaping the nature of inters organizational commerce by enabling many new types of interfirm electronic exchanges. A B2B exchange is defined as a new organizational form residing in digital space that acts as an interfirm intermediary that enables firms to conduct and engage in any-to-any online relations payment gateway for school. This chapter proposes a classification scheme for B2B exchanges that attempts to capture the chaos and complexity of today’s online B2B relations.

This typology integrates several theories of interfirm relations from the information systems, marketing, and organizational economics literatures to propose a parsimonious but comprehensive taxonomy that encompasses neutral markets (many-to-many) and dyadic relations (few-to-few), and also the concept of biased relations, monopolies (few-to-many) and monopolies (many-to-few). This chapter discusses the implications of the proposed taxonomy for inter organizational e Commerce that ensue from the alternative types of B2B exchanges. Furthermore, the influence of product, organizational, and market characteristics on B2B e Commerce is discussed, and guidelines for appropriate selection of exchange type and particular B2B exchanges are proposed.

Intense competition in electronic markets and the growing number of web-based B2B marketplaces have made inter organizational e Commerce important and challenging. The notion of B2BeCommerce is not new, but its scale and scope has proliferated with the advent of B2B exchanges, which provide a facilitating structure for virtual relationships by enabling an easier identification and selection of suppliers and products, lower transaction costs, and more integrated supply-chain management compared to traditional channels (Dai and Kauffman, 2000). With over 1,000 currently established Internet B2B exchanges and an expected online transaction volume of over $6 trillion by 2004, a primary issue associated with research on B2B exchanges is their proper classification.

Most B2B exchanges have substantially different characteristics in terms of their industry and product focus, the type of relationships and power asymmetries between buyers and suppliers, and type of product sourcing. The complexity of B2B exchanges calls for a complete but parsimonious typology that can bring order to the chaotic space of B2B e Commerce. Before being able to make some systematic efforts to capture today’s chaotic B2B environment and build new theories, an academic-oriented classification scheme should be introduced to link the existing literature into the new landscape. Hence, the primary purpose of this chapter is to establish a comprehensive and versatile typology to capture and explain the scope of today’s B2B exchanges, illustrated by existing real-life examples.

An important application of B2B e Commerce has been the inter organizational information system (IOIS) through which multiple firms interact online to identify and select trading partners, negotiate, and execute business transactions. Internet-based IOIS can be considered as an extension of traditional EDI-based systems that enable firms to transact without investments in dedicated assets. Nonetheless, perhaps the most important development of an IOIS is the web-based B2B exchange, which is not merely a more advanced information system that acts as an interfirm intermediary, but it also offers an organizational arrangement with certain institutional structures to coordinate interfirm relations.

A B2B exchange is defined as a new organizational form residing in digital space that acts as an interfirm intermediary that enables firms to conduct any-to-any online relations. Transacting through web-based exchanges may reduce transaction costs, increase the availability of products and suppliers and reduce dependencies on a few trading partners and products. Moreover, B2B exchanges may offer several secondary services towards integrating purchasing, distribution, and inventory processes, streamlining the entire transaction process payment gateway for college, thus allowing better inventory management, quality control, and supply chain processes.

Finally, many exchanges may offer collaborative services for joint planning, design, and forecasting. Therefore, B2B exchanges become more flexible coordinating mechanisms with fewer inefficiencies and faster operations compared to physical undertakings. By participating in B2B exchanges firms can significantly increase their transaction efficiencies; hence, without loss of generality, firms can achieve cost-savings by employing B2B exchanges in their e Commerce efforts.

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