Business2Business or B2B activity refers to all e-commerce transactions that can occur between two organisations. This includes purchasing and procurement, supplier management, inventory management, channel management, sales activities, payment management, and service and support.
B2B transactions occur when businesses buy and sell goods to and from each other. “In 1999 B2B commerce was estimated to be about $1.3 trillion by 2002.� (School of International Business, 2004, p.36) Basically this e-commerce strategy works in a way that allows businesses to have more buyers, and then equally there are more sellers with goods available to these buyers. It is not all about outside consumers. Sellers can learn from each other and even produce complimentary goods, to corner a bigger market share.
The main disadvantage of the high number of buyers in sellers is that unlike in C2C commerce, they are all fragmented. Buyers will not know who all the sellers are, and sellers will not know who all the buyers are. This fragmentation results in both parties having to trawl through millions of web pages trying to find each other. This, in turn, can often increase transaction costs, because the cost-per-customer is increased. It costs more money for both parties to find or attract each other.
Queensland University of Technology, School of International Business (2004) Introduction to e-business Australia: McGrawHill & QUT Custom Publication, ISBN 7777772570.
Melanie Mackrodt 13:20, 3 Sep 2004 (EST)
Catherine Cherry 13:49, 8 Oct 2004 (EST)
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