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Business-to-consumer (B2C) describes a business selling to or serving individual consumers. The term identifies who a company deals with as its external customer—not whether it uses a particular technology or sells online.
What is business-to-consumer (B2C)?
B2C is a business relationship in which a company’s customer or external counterparty is an individual consumer. A retailer selling a product to a shopper is a straightforward example. The same classification can apply to services; online commerce is only one setting for B2C activity.
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IBM Redbooks puts the distinction plainly: “The definition of B2B and B2C is first and foremost a business issue.” It also says the definition “does not introduce any technology.” IBM Redbooks, B2B Solutions using WebSphere Partner Gateway V6.0, section 1.2.
How is B2C different from B2B?
The key difference is the identity of the customer or external counterparty:
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| Model | External customer or counterparty | Example |
|---|---|---|
| B2C | Individual consumers | A shopper buying from a retailer |
| B2B | Other businesses | One company supplying another company |
Transaction patterns can differ, too, but they do not define the categories. Business-to-business deals may involve standing or repeat orders, negotiated terms, credit lines or open orders, and longer-term buyer-seller partnerships. These are possible tendencies, not requirements for every B2B transaction.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Is B2C limited to online shopping?
No. A company can serve consumers in a physical store, through a website, or through another channel. A public e-commerce website is one example: IBM Redbooks compares it with a street store that anyone can enter to make a purchase. A shopper may be able to buy as a guest, while registration can help the seller maintain an ongoing customer relationship. The website is an example of B2C, not what makes a business B2C.
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How to identify a B2C business
- Identify the external customer. Look at who the company sells to or serves.
- Check whether that customer is an individual consumer or a business. Consumers point to B2C; business customers point to B2B.
- Do not use the sales channel as the deciding test. A website, storefront, or particular technology does not by itself determine the category.
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