business to business

Business to Business

Business-to-business, often indicated by the acronym B2B, is a term used to describe electronic commercial transactions between companies, distinguishing them from those that occur between companies and other groups, such as those between a company and individual consumers / customers (B2C , from the English Business to Customer or Business to Consumer) or those between a company and the government (B2G, from the English Business to Government).

B2B - Business-to-business

Description

It is a term that refers to generic processes between commercial partners, and which can also refer to all transactions carried out in an industrial value chain, before the finished product is sold to the final consumer.

More specifically, Business-to-Business or B2B indicates the relationships that a company has with its suppliers for procurement, production planning and monitoring activities, or to aid in product development activities, or the relationships that it company holds with professional customers, ie other companies, located in different points of the production chain.

The volume of B2B transactions is much higher than that of B2C transactions. According to estimates, in 2018 the value generated by the B2B transaction was approximately 2,700 billion euros (of which 335 billion generated by B2B e-commerce alone), accounting for 75% of the entire turnover of Italian companies. [1] One reason is that businesses have adopted e-commerce technologies far more than consumers have. Furthermore, in a typical supply chain (or logistic chain, in ing. Supply chain), there are many B2B transactions, but only one B2C transaction, since the complete product is retailed to the final customer.

For example, the business relationship between a manufacturer and a wholesaler is a B2B relationship. The direct relationship between producer or wholesaler, on the one hand, and customer / consumer / final private user, is defined as B2C. Another example of a B2B transaction is a chicken feed company selling its product to a chicken farm, which constitutes another company. Another example of a B2C transaction is a grocery store that sells grain-fed chickens to a consumer. B2B can also describe marketing activities between companies, not just the final transactions that result from marketing, although the term can in fact be used to identify business transactions between companies (also referred to as ‘institutional sales’) . For example, a company that sells copiers is more likely to be identified with a B2B rather than a B2C business organization.

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