16 Jul B2B Sales: What Are They, and Who Needs Them?
B2B Sales: What Are They, and Who Needs Them?
On the Internet and at the workplace, you might have heard the term “B2B” sales thrown around. If you’re unfamiliar with the meaning of this term, then you’d better get with the program—especially if you’re a business owner or thinking about becoming one. “B2B” might look like alphabet soup to the uninitiated, but it’s one of the business world’s most important acronyms.
The volume of B2B sales dwarfs the number of B2C sales.
To put it succinctly, B2B stands for business-to-business. Yes, I know, it’s a bit obnoxious to use the number 2 instead of the word “to”… but that’s Web 2.0 for you, so get used to it! B2B means commerce transactions that take place between one business and another business. Are you ready for more acronyms? There’s also B2C, or business-to-consumer, in which a business sells goods and/or services directly to customers. B2C is also commonly known as retail commerce. Most of us are much more familiar with B2C transactions, but it might surprise you to learn that the volume of B2B sales dwarfs the number of B2C sales. However, if you analyze the process, it makes perfect sense. Consider the purchase of a new car, for example. On the B2C end of things, there is just one purchase made when the car buyer purchases the car. Before that can happen, though, the automobile manufacturer has already made a number of B2B purchases, as it had to buy tires, hoses, the battery, glass for the windshield, and so on. Another example would be a personal or laptop computer. When you purchase a new computer, that counts as a B2C transaction, but that computer’s parts likely came from a number of places around the world. Thus, a large number of B2B sales had to be made in order for the computer to exist in the first place.
Think Big B2B Sales
There is nothing wrong with B2C sales, as the end user is ultimately what makes the economy go ’round. Still, if you truly wish to think large-scale, then you might consider venturing into the B2B end of the market. Compare selling furniture to a new homeowner versus selling office equipment to a new business, for example. Imagine selling an Internet security program to an individual versus selling that same program to a business with a multitude of computers… You get the idea. The fact is, companies have more money to spend than end users do. Besides, individuals tend to be more liberal in spending a company’s funds than in spending their own personal funds. In addition, by focusing on B2B sales, you might be able to avoid the incredibly fierce competition associated with B2C sales. If there’s a product you’re thinking of selling directly to consumers, look on the Internet and see all of the competition out there… You might just decide that B2B is the way to go. Remember you can be wholesale and sell to distributors who then sell to consumers. You would be B2B and the distributor is B2C.
There is still another acronym you should know about: B2G, which stands for business-to-government. Whenever a business sells a product or service to the government, that is considered a B2G sale. This would include sales to federal, state, and local governments. Securing a sales contract with the government can prove to be quite lucrative for any business. Imagine, for example, if your business created a computer database specifically designed for use by government agencies. Not only could a government agency pay for the license to use your database, but it could also utilize the services of your business to maintain and periodically upgrade the database. There is a huge potential for profit here!
So, who needs B2B sales? If you’re serious about big profits and want to avoid becoming yet another B2C statistic, the answer might just be you. Do your research and look into B2B… It might just be your key to prosperity.