The Rocky Mountains of Markets

Businesses can be categorized according to its business model. And business model have two types – business-to-business and business-to-end-consumer. Between these two, the business-to-end-consumer model is the more typical one. And not most people are aware of the business opportunities in a business-to-business model.

B2B or business-to-business is a model wherein a business entity sells to another business entity a product or service that is rendered to an end-customer. The B2E or business-to-end-customer is the model wherein a business entity directly sells a product or service to the end-customer. Another way to distinguish these two is through the composition of their clientele. B2Bs have few but large volume clients while B2E have many but considerably lower volume clients.

The advantages of a B2B business model is that its client is another business entity which has a more stable and definite customer requirements, unlike the B2E wherein client requirements greatly varies and can drastically change. With B2B, the demand is more accurate and comes in bulk quantity which is better profit and production wise. Examples of B2Bs are supplying automotive parts to a car manufacturer, plastic packaging materials to a food manufacturing business or in the service sector, providing maintenance services to a company.