Business-to-Business (B2B): What It Is and How It’s Used

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Business-to-Business (B2B): What It Is and How It’s Used
By James Chen Updated May 10, 2024
Reviewed by Julius Mansa
Fact checked by Ariel Courage
What Is Business-to-Business (B2B)?
Business-to-business (B2B), also called B-to-B, is a form of transaction between businesses such as a manufacturer and wholesaler or a wholesaler and a retailer. Business-to-business refers to commerce that's conducted between companies rather than companies and individual consumers.

Business-to-business stands in contrast to business-to chinese overseas africa database-consumer (B2C) and business-to-government (B2G) transactions.

Key Takeaways
Business-to-business (B2B) is a transaction or business conducted between one business and another, such as a wholesaler and retailer.
B2B transactions tend to happen in the supply chain where one company will purchase raw materials from another to be used in the manufacturing process.
B2B transactions are also commonplace for auto industry companies, as well as property management, housekeeping, and industrial cleanup companies.
Meanwhile, business-to-consumer transactions (B2C) are those made between a company and individual consumers.
Business-to-Business (B2B)
Lara Antal / Investopedia

Understanding Business-to-Business (B2B)
Business-to-business transactions are common in a typical supply chain because companies must typically purchase components and raw materials for use in their manufacturing processes. Finished products can then be sold to individuals via business-to-consumer transactions.