B2B

What is B2B?

B2B (Business-to-Business) refers to transactions, relationships, or dealings that happen between two businesses rather than between a business and an individual consumer. In other words, one business sells its products or services to another business.

For example, a manufacturer selling machinery to a factory or a software company providing tools to a bank are both B2B transactions.

Examples of B2B Companies

1. Tata Steel supplying steel to car manufacturers like Maruti.
2. Zoho providing cloud-based software to small businesses.
3. Blue Dart offering logistics services to e-commerce companies like Flipkart.

A wholesaler selling goods in bulk to a retail store.

Types of B2B Models

1. Product-Based B2B:

• Companies that manufacture or distribute products to other businesses.
• Example: A chemical company supplying ingredients to a cosmetics firm.

2. Service-Based B2B:

• Companies that offer professional services like IT, accounting, or legal support.
• Example: A cybersecurity firm working with banks.

3. Software-as-a-Service (SaaS) B2B:

• Tech companies that sell subscription-based software to businesses.
• Example: CRM software providers like Salesforce or Freshworks.

B2B Marketplaces:

• Platforms where businesses buy/sell products and services.
• Example: IndiaMART, Udaan.

How B2B Works?

The B2B process usually involves:

• Identifying business needs
• Comparing multiple vendors or suppliers
• Requesting quotes (RFQs)
• Negotiating terms
• Signing contracts
• Delivery and post-sale support

B2B sales often involve long-term relationships and higher order values.

Importance of B2B in the Economy

1. Drives supply chains and production
2. Fuels industrial and service sectors
3. Encourages specialization (e.g., one firm focuses on manufacturing, another on distribution)
4. Key part of India's economic ecosystem, especially for MSMEs, logistics, and IT sectors

B2B vs B2C (Business-to-Consumer)

Feature	B2B	B2C
Customer	Other businesses	Individual consumers
Sales Volume	Usually high (bulk orders)	Usually low (single units)
Decision-making	Longer and involves multiple people	Quick and personal
Pricing	Custom or negotiated	Fixed or listed
Example	SAP selling ERP software to a firm	Amazon selling a phone to a person