E-commerce is one of the fastest growing avenues of buying and selling products. The internet gives us access to other buyers and sellers that we would never in a million years encounter without it. There are many different types of e-commerce, but this is going to focus on only one: Business to Business e-commerce.
The Business to Business (also known as B2B) model is different from other types of commerce because instead of focusing on listing products or services that are geared for an individual person for sale on amazon.com or other websites, this type of commerce is focused on providing a service or product to another business. Primarily these products are bulk materials, such as raw materials needed for another company to produce their own product. These types of transactions occur just as frequently as other e-commerce categories (Consumer to Business, Business to Consumer and Consumer to Consumer) but because these items that are being purchased by businesses often undergo transformation before they make it to the public eye, this type of commerce may not be as well known.
A great example of business to business commerce is a restaurant. The owner of the restaurant has to order vegetables from their vegetable distributer, and meat from a separate source, and then they have to order wine and beer from the different suppliers that provide those services. At the end of the day, they clean their restaurant with cleaning supplies that are purchased in bulk from yet another distributer. The customer does not see all of these moving parts that occur, all they see is the experience that they get when they dine at the restaurant.
With the explosion of electronic transactions, or e-commerce, today, this has affected businesses slightly differently than individual consumers. Consumers are just as likely to buy and sell on websites like overstock.com or other sites when they need to make a day to day purchase. Business to business commerce purchases are often recurring purchases that are made in bulk. This means that often a relationship is created between the two businesses that is likely to go on for a long time. Because Business to business commerce is already relationship based, e-commerce or electronic purchases are not made in the same way. Instead of shopping selection, comparing prices and reading reviews before purchasing from someone that sells on amazon.com, a business may use electronic sources to make minor adjustments to large purchases. In the example of the restaurant, maybe the other decides that they need two more cases of toilet paper on their next order, and two less of window cleaner. They can also use the internet to view invoices and past orders. But they are often not price shopping or writing reviews the way that an individual consumer would be doing. Since their orders are often made on a recurring basis, payment may look different too. Instead of upfront payment for an item or service, they likely pay on a monthly basis, and only after delivery of their products.