From One Company to Another

Catapult to the next level with profitable business-to-business relationships

Sisters Eve and Holly have stepped up efforts to forge b-to-b relationships. (Source: Nick Anthony/Wonderful Machine Inc.)

When sisters Eve Lane and Holly Lane-Mixon launched Zebra Lane on a shoestring budget of $500 in 2003, they knew they wanted to expand their fraternity and sorority stationery and gift business beyond the retail realm into the world of business-to-business—conducting transactions between themselves and wholesalers or retailers.

Six years later, the company does both: business-to-consumer, selling direct to consumers at conventions and through an e-commerce site featuring more than 400 products, and b-to-b transactions which they often solicit from clients at trade shows. Through these efforts, Zebra Lane grosses annual revenues close to $200,000. But the transition into b-to-b was neither easy nor instant.

At startup, 100% of Zebra Lane’s business was direct-to-customer sales; today, it’s 65%, with the remaining coming from wholesale trade. But given the success of recent b-to-b exchanges, the company is looking to up the ante to 70% wholesale and 30% retail.

“Having a small company and working with the end-customer is a job in itself,” says Lane-Mixon, 32. “But business-to-business customers have a whole new set of needs.”

“Once you change your strategy, unless you have multiple and unlimited resources, you are really talking about two different business models” says Tiffany Bussey, director of the Morehouse College Entrepreneurship Center in Atlanta.

Transitioning into a b-to-b while operating a b-to-c entity can be done, but it is a considerable challenge, especially for small companies with limited resources. To transition successfully, Bussey suggests companies retool their business plans carefully because the b-to-b model requires a completely different marketing strategy from that of the b-to-c model.

“One of the biggest mistakes businesses make in terms of advancing from b-to-c to b-to-b is they don’t advance their business plan,” says Sean Rugless, president of the Greater Cincinnati African American Chamber of Commerce. “It is the one document necessary for lending and mentorship, and sometimes b-to-b companies require [an updated plan] as well because they want to know what you are doing in order for them to grow too.”

Rugless also says companies making the shift should refresh their understanding of cash flow management. “With b-to-c, you are instantly paid. The consumer walks in, buys your product, and you have cash flow,” he explains. “With b-to-b, you expand the timeline necessary to realize payment. You may do business today and not be paid for 30 to 60 days.”

While moving into a b-to-b relationship requires huge investments in time, resources, and talent—none of which small businesses have amply available—the results can be rewarding in diversifying revenue streams and expanding from what may already be a saturated consumer market. Of course, Rugless recommends that entrepreneurs stabilize their consumer arm before introducing another business model. “The focus is going to be split with new demands,” he warns, and says business owners should prepare to feel conflicted. “One of the biggest challenges many face is trying to figure out how to do both extremely well.”

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  • Blackscholar

    This story visually shows the type of Eurocentric imagery these “so-called” Black magazines perpetuate by showing very light-skinned Black women emphasizing psuedo-elitism selling “Greek paraphenalia”(actually, Blacks can not be Greeks). For those that dissent, I would appreciate your telling me the Start point and End points of the “Underground Railroad”, or have you ever been to Greece? Its quite baffling that scores of “degree holding” Blacks yearn to accepted and validated by the larger White society living in the suburbs. Finally, Black Enterprise magazine is nothing but a “So-called” Black elite magazine that only focus on making money while never publicly addressing any salient issue impacting the collective Black community. Case in point, Black Enterprise is located in NYC but have not addressed the issue of Black removal (ok, gentrification) within the pages of this glossy magazine. Then, they wonder why their magazines subscriptions is in the tank.

    Amandla(power, in isiZulu)!

    Blackscholar

    • stacey

      I never respond to this kind of diatribe but I am so sick of listening to this rubbish. If you are failing it is your fault. Plain and simple. We should not accept this rubbish from scholars or anyone else. This magazine is a financial magazine the last time I checked not a journal for social workers.

    • http://www.kobaltbooks.com Cedric

      Black Enterprise is about black people, running successful businesses. Last I checked, there were all shades of black folks in that magazine. If someone started a company with $500, and never got a loan from a bank… Grinded their way to six-figures, and didn’t ask for a thing, while a recession is going on… Then that’s why they deserve to be in the magazine. So, don’t get mad. Either get your own business poppin, or start your own magazine, and exclude all light skinned people and all affiliations with Greek Sororities and Fraternities. At least the Sorors and Frats are promoting black folks getting an education while maintaining a respectable GPA. Perhaps we should be focusing on the intent of the article… And that’s to transition from Business-to-Consumer, to Business-to-Business, instead of bringing up foolishness to debate about.

  • GMO

    Congrats to Zebra Lane on all of their success. Don’t hate dude.