B2B
What Is B2B
B2B means Business-to-Business. It is a type of transaction or sale that happens between two different types or layers of businesses. For example, a sale or transaction involving a retailer, wholesaler, and manufacturer. This means that the customer of a B2B transaction is another business and not the direct customer.
In this type of model, businesses share services and goods, such as raw materials for manufacturing, which are then used by the manufacturer to create a product for the wholesaler. Another example of the B2B model is acquiring services for your business, such as marketing or advertising service for the business.
Why Is B2B Important
The B2B business model is imperative to join or synchronize an entire supply chain. The first step of the entire supply chain starts with procurement, which happens via B2B businesses. Therefore, B2B businesses pass on products or services in a way that end customers can eventually purchase them.
Sometimes, these B2B models help grow and operate properly. For example, purchasing office furniture for your space from another business. It is a type of B2B transaction that helps your business create a comfortable space for employees.
If you look at it, then without B2B businesses, B2C may never happen. B2B businesses pass on products and services necessary to create products and services for end consumers.
How B2B Market Works
The B2B market involves three different sectors, primary, secondary, and tertiary.
In the primary market of B2B, the supply is driven by primary raw materials sourced from oil companies, farmers, or gas companies. This is an exclusively B2B market.
In the secondary market, companies manufacture and create products using the above raw materials to sell to the end customers. Here, the manufacturer may use the resources from the primary market to create something valuable. This market is also nearly exclusive to B2B.
In the tertiary market, there’s a fine blend of B2B and B2C. These B2B firms deliver goods to service-based businesses. Some tertiary companies are only B2B companies too. They provide the goods and services that other tertiary customer-facing companies need to do their jobs.
