B2B business model is frequently heard these days. However, most people do not know much about what it is and how it is used in work life. B2B business model is also called the Business-to-Business model. Companies use this model to increase their revenue, earn market share, and strengthen their brand name. Let’s explain what B2B business model is in more detail.
What Is B2B Business Model?
B2B business model creates services and products for other businesses. It mainly involves a manufacturer and wholesaler. It is not conducted between a company and an individual, but between companies. There are some critical points of B2B Business model;
- B2B business model mostly happens in the supply chain. For example; one company gets raw material from a manufacturing company to use in manufacturing.
- The exchange of services takes place between two companies or more.
- B2B business model gives the opportunity to connect with partners.
- With the connections, they find the best providers for their needs.
- It saves time for businesses to save time in finding new suppliers in their country or abroad.
What Are the 3 Types of B2B Business Models?
Like many other businesses, B2B business is divided into some categories. Each company gets support from B2B providers, suppliers, or partners. Some sectors are payroll and tax, research and development, marketing and advertising, human resource, and many other variable ones. Now, we will see 3 types of B2B business models.
Customer Centric Business Model
It is a type of model in that customers have the same value even after the sale. The main purpose here is to keep a good relationship with the customer to have a profitable business again in the future. Here, customers have a great influence on the business, they are the main focus. In customer Centric Business model, the companies do their best to develop their customer satisfaction services such as; customer preference management. These companies strengthen the connection with the customers by serving the best for them. If your main focus is customers, you can get a major benefit from Peerbie seeing your customer movements.
Buyer Centric Model
It is mostly preferred by big companies as they have a higher rate of purchases. Here, the buyers set up a portal in which sellers and providers present themselves or their products. The sellers can approach the buyers with the quote that they choose. They can try to convince them. In the end, it’s the buyers’ decision to agree on a company according to their budget and expectations.
Intermediary Centric Model
Intermediary Centric Model is one of the most used business models. It presents a platform for both sellers and buyers. In this platform, they can interact with each other and transact their business. Intermediaries prepare this platform. And what do intermediaries get the benefit from it? They earn a fair share of commission from the parties. It is a successful additional platform that helps businesses to drive themselves in marketplaces.
How B2B Business Model Is Used?
We already said that it is a business model that brings together businesses to trade. It gives the business a chance to find the best providers suitable for their budget and what they expect from a trade. To give some examples to understand it better; in Upwork, you can post or search for jobs. It is an online platform that brings people who are looking for jobs and who need employees. Alibaba is another example that sellers and buyers can meet. It is one of the direct connection B2B models. Alibaba guarantees its success as people always need a platform to buy and sell.
Especially with the internet, it becomes much easier to develop a B2B business model. Companies can contact partners there. They can explain themselves and their products on online platforms. On these platforms, both companies sometimes have the power to negotiate which greatly helps their business. Besides that, customers can compare the products and prices; they can get ideas from customer comments.
With B2B models, employees can easily be in contact with one another; such as social media. They can broaden their business through sharing which is very significant in this digital life. B2B business model encourages businesses to come together and share their business to benefit them. It supports to grow logically.