What is Business to Business (B2B) Ecommerce?

What is Business to Business Ecommerce (B2B)?

Business-to-Business (B2B), also known as B-to-B, is a transaction between a manufacturer and a wholesaler or wholesaler and retailer. Business to business refers to a business that takes place between companies rather than between the company and individual customers. The business-to-business stand is the opposite of business-to-consumer (B2C) and business-to-government (B2G) transactions.

Just go through the video below explaining B2B E-commerce

Here are some key highlights of B2B eCommerce

The business resells goods and services produced by others (for example, a retailer who buys the final product from a food manufacturer).

B2B often contrasts with business-to-consumer (B2C). In the B2B trade, the parties to the relationship have comparable negotiating power, and even if they do not, each party usually has a professional staff and legal adviser in negotiating the terms, although the size of the B2C is much larger. Degree through the financial implications of information inequality.

However, in the case of B2B Ecommerce, large companies have many commercial, resource, and information benefits compared to small businesses. For example, the United Kingdom Government has passed the Small Business Act 2016 under the Enterprise Act 2016 to “resolve disputes between small businesses” and “to consider complaints about payment issues by small business suppliers with large businesses”. Created the post of Commissioner.

Business-to-business companies represent a significant part of the United States economy. This is especially true of companies with 500 employees and more, of which 19,464 in 2015, where

Business-to-Business Example (B2B)

Common to companies in the preparation of business-to-business transactions and large corporate accounts. For example, Samsung is one of Apple’s largest suppliers of iPhone processing products. Apple also has B2B relationships with companies such as Intel, Microsoft (Learn about bing ads), and semiconductor maker Micron Technology.

B2B transactions are also the backbone of the automobile industry. Many vehicle parts are manufactured & processed independently and automobile manufacturers purchase these parts to assemble automobiles. For example Engines, batteries, electronics, gearboxes, and door locks are usually manufactured by various companies and sold directly to automobile manufacturers.

Service providers also participate in B2B transactions. For example, companies that specialize in property management, housekeeping, and industrial cleaning sell these services to businesses other than individual customers.

B2B Business Models

B2B is a type of business model where goods and services are exchanged between two or more businesses. Customers usually do not participate in these types of models and will only be implemented in the next stage.

Most of these transactions take place in the exchange of raw materials. In a typical scenario, a business receives equipment from another business to make a new product.

You can see that this often happens in the technology industry, a famous example is the Apple iPhone. Apple makes iPhones under its trademark but receives various chipboards from Samsung as mentioned earlier. Although considered rival companies, the B2B relationship benefits both.

In most B2B business models, the two businesses benefit from each other in some way and have comparable negotiation powers. They also hire professional staff and legal advisers who are constantly engaged in negotiations with other businesses.

The final product you see as a result of processing and manufacturing is usually of quality and goes into the market many times more than the initial investment on the raw material.

Vertical B2B Model

It is usually based on manufacturing or business. It can be divided into two directions - upstream and downstream. Manufacturers of commercial retailers can maintain supply relationships and enhance sales relationships with upstream suppliers, including manufacturers. For example, Dell may be affiliated with upstream suppliers of integrated circuit microchips and computer printed circuit boards (PCBs). Working together.

The vertical B2B website is similar to the enterprise online store. Through a website, a company can promote its products more powerfully, more efficiently, and more widely. Help customers better understand their products. Or, you can create a website for the business where the seller advertises his products to promote and expand his products in a smooth and convenient manner.

Horizontal B2B Model

Horizontal B2B is a trading model for the Intermediate Trading Market. It concentrates transactions between industries in one place because it provides a business opportunity for both the buyer and the supplier, which usually includes companies that do not have products and do not sell products. . It’s just a platform to bring sellers and buyers online. Better platforms help buyers easily find relevant information about sellers and products through the website.

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