Business-to-business (B2B) is a business transaction involving one company selling products or services to another company. B2B transactions are usually between businesses with a commercial relationship, such as suppliers and customers, manufacturers and distributors, or service providers and business clients.
In a B2B transaction, both businesses usually try to achieve their commercial goals. For example, a supplier may be trying to sell as much of its product as possible, while a customer may be trying to get the best price for the products it needs. B2B transactions can involve large sums of money and complex contractual arrangements.
B2B transactions differ from business-to-consumer (B2C) transactions, in which a business sells products or services to individual consumers. B2C transactions are usually much more straightforward and involve less money than B2B transactions.
There are many different types of B2B businesses. Some common examples include:
- Suppliers and customers: A supplier sells products or services to a customer. This type of B2B transaction is common in many industries, such as manufacturing, agriculture, and mining.
- Manufacturers and distributors: A manufacturer produces products that are then sold to distributors. The distributors then sell the products to retailers or other businesses. This type of B2B transaction is expected in the food and beverage industry, among others.
- Service providers and business clients: A service provider sells services to business clients. This type of B2B transaction is common in the consulting and IT industries, among others.