Recently, we hear B2B and B2C often, although there are some people who don’t know the meaning of both. Usually B2B and B2C are common terms for businessmen, those terms are related to how a business runs. Let us get to know what B2B and B2C are.
First, let us talk about B2B. B2B or Business to Business is a business which provides goods or services for other businesses in a massive number which is not for consumers. B2B would provide such as raw material or business system development for example web or administration service. As we know that a big business with huge income needs a web for branding, monitoring the stock, finance, development, etc. to keep the business managed and organized.
Source : Freepik
Then, how does a B2B work? The following below are how a B2B works
There is a condition when a company needs raw material or service from another company. For example; let us say that A is a developed company, it needs an administration system from another company which runs in web or system development.
Usually a business offers its services, for example; let us say that it is a web or system development service. The business offers it to some other businesses so that they use the service for operations.
After two companies meet each other and talk about the needs, there will be negotiation, and if they get agreement a contract will be made for both companies.
After the contract has been made, they will have cooperation to fulfill their main consumers.
Knowing B2B further. B2B has some characteristics we should know.
Usually a B2B has a long term contract to keep the company running constantly.
- Dependencies between each other is caused by needing each other to keep their own business running well.
- A B2B goes with a complex transaction process because it needs to have negotiation to make the long term contract.
Meanwhile, B2C is a business which provides its own high value products and sells it directly to consumers or customers. For example; selling clothes, snacks, and bags. B2C sells the product through an offline or online shop.
Source : Freepik
We have talked about the characteristics of B2B, so let us talk about B2C characteristics.
Usually a B2C company would open to the public. It allows the customers to know the products including the ingredients and all kinds of the products. It is a public secret so it would spread worldwide.
B2C usually uses simple transactions in each sale. It happens also in each sale or even in repeat order. But B2C companies are more concerned about the relation between the company and the customers.
- A B2C company usually provides goods or services to a certain market. It means they work on demand in the market.
- High tension competition happens in the B2C world. Because everyone can do the same thing with the same product including the ingredients or even the models.
Source : Freepik
Let us make it more simple about the differences between B2B and B2C
B2C approaches the consumers or customers, meanwhile B2B approaches other companies by providing raw materials or services.
Usually a B2C ready to sell product to customers or consumers with high value and price. For example; clothes or even a marketplace like ‘shopee’ that provides the product directly to the customers and consumers. Meanwhile a B2B provides massive raw material or web development and administration system services l for other companies.
The approach ways are different. A B2C approaches the customer heart-to-hart with the value of its products. Meanwhile B2B approaches other companies through presentations with longer processes because a B2B usually has a purpose to make long term contracts.
A B2C makes the price based on the market. It means a B2C needs to do research to make the price of the products. So it is more flexible. Meanwhile a B2B makes the price based on the company client needs through discussion.
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The conclusion is, B2B focuses on what other companies need rather than make products for consumers. Customer trust is the priority to have continuous cooperation (retainer) with its customers.
Meanwhile B2C must have a good system in all business aspects, starting from the marketing to the product distribution. More customers is much better for that kind of business.
According to the information above, you are expected to understand the differences between B2B and B2C so that you can make your best strategy to improve your business,
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It means the company would be much easier to monitor the business condition real-time. If you want to upgrade your business to the next level especially in the operational aspect with CRM by Panemu, please just contact us through our website.