Business-to-business (B2B) is still a relatively novel concept in sourcing from China, as most payments are still made via more conventional methods, i.e. bank transfers and Letters of Credit. As Bill Dodson writes at This is China! Blog,

For most companies in China, the websites are little more than brochures for brick-and-mortar operations that provide a service or product that is paid for in ways other than the internet. B2B in the form of e-commerce has been more difficult to monetize - especially in China - because the products on offer have to go through a manufacturing process that may or may not involve design, testing and quality checks.

In addition, international transactions are further complicated by currency conversion issues:

A company cannot simply wire money to a Chinese bank if the supplier does not have a foreign currency account at the bank. The supplier also requires permission to convert the payment into RMB that the bank will hold in the company's RMB account. Such complexity and sophistication are beyond the reach of most suppliers, which are miles away from banks that likely do not support such services in the countryside anyway.

Alibaba's Alipay, originally created to support online auctions at Alibaba Group asset Taobao, however, is China's first attempt at an online payment system, and portals like Alibaba and Made-in-China are increasingly inserting themselves in online transactions between buyers and sellers. Alibaba this week also announced plans for a partnership with Intel to launch a special B2B computer to meet the e-commerce demand of small and medium enterprises in China. The computer will be embedded into Alibaba's e-commerce platform for SMEs, and is expected to be released within the year.

Yet as China's B2B industry grows rapidly and as China expands domestically and internationally, certainly there is room for more than one Alibaba? So concludes Seeking Alpha, while profiling e-Future, a player that is growing at an exponential pace in the B2B industry. In less than one month, e-Future has launched two new websites to go along with its www.99114.com.cn, and as Seeking Alpha reported in March, for the duration of last year e-Future grew by 79%, making it a veritable cash cow due to the fees the company obtains for software contracts provided to customers.

See also Source Juice: Importing over the Internet? Challenges, opportunities, and hedging your bets!