What is B2B?

B2B (Business-to-Business) is the business model in which an organization sells products or services to other organizations rather than to end consumers. Enterprise software, cloud services, industrial supply and consulting firms all operate in this format.

Its counterpart is B2C (Business-to-Consumer), where the customer is an individual. The differences between the two go far beyond who pays — they change the product, the marketing, the sales team and even the software architecture.

What changes in practice

• Sales cycle — weeks or months in B2B, versus minutes or days in B2C.
• Collective decision — the person who uses, the person who approves and the person who pays are usually different people, with different criteria.
• Deal size and volume — a few high-value customers instead of many low-value ones.
• Rational purchasing — the decision is justified by return, cost reduction or compliance, not by desire.
• Ongoing relationship — recurring contracts, renewals and dedicated support weigh more than the initial sale.

The impact on a software product

Selling to companies imposes technical requirements that B2C products rarely face. They come up early in negotiations and frequently decide the deal:

• Multi-tenancy — isolating each customer’s data on the same infrastructure, with rigorous guarantees of separation.
• Role-based access control — organizations want to define who sees and does what, with granularity.
• Audit logging — a record of who performed each action, a common compliance requirement.
• Single Sign-On — integration with the company’s identity provider, frequently a mandatory item.
• SLA and support — contractual commitments on availability and response time.
• Integrations and API — the product needs to talk to the systems the customer already uses.

The metrics that matter

Subscription-based B2B models track their own indicators: MRR/ARR (monthly or annual recurring revenue), CAC (customer acquisition cost), LTV (customer lifetime value), churn (cancellation rate) and NRR (net revenue retention, which measures whether the existing base grows on its own). The ratio between LTV and CAC is the main indicator of whether the model is sustainable.

Other acronyms in the same family

Beyond B2B and B2C, the vocabulary includes B2B2C (a company sells to another that serves the end consumer), B2G (selling to government, with its own procurement rules), C2C (between consumers, as in marketplaces) and D2C (the manufacturer sells directly to the consumer, skipping distributors). The intersection with technology is explored in marketing and information technology.