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B2B2C: What is it and How Does it Work?

No time for shopping on the weekend? One click and you’re all set. Out of munchies on your TV evening? Just run down to the kiosk. Whether it’s online or at a store nearby, when end consumers shop, they often get a business model rolling that is known as B2B2C.

B2B2C stands for business to business to consumer. In a nutshell, B2B2C is when a business finds another business to purchase a product and, acting as a kind of third party, sells the product on to the consumer. This business-to-consumer (and now largely online) trade model can take many different forms, but generally applies to the simultaneous sale of products or services to both businesses and consumers. When a consumer purchases or orders a product or service from a business that purchases or orders through a different business, that’s B2B2C in action.

A prime example: food delivery apps. They are one of the most common forms of B2B2C e-commerce. The delivery service app operator (B) sells its delivery services to both the restaurant (B) that makes the pizza as well as the consumer (C) who wants to have the pizza home-delivered ready to eat.

B2B2C pays off because it creates new synergies with huge potential. Both ‘B’s (businesses) benefit from the expertise and resources of their respective business partners instead of having to make such investments themselves. This permits both parties to concentrate on their core business and still build up a whole new distribution channel.

It also opens new doors for consumers. First and foremost, they benefit from having fewer obstacles when shopping, especially online. Mobile devices enable consumers to shop anytime, anyplace. They can display entire product lines and their availability in real time. Convenient home delivery is usually both fast and contactless. In times of the coronavirus, during which shopping behaviour has changed, this is a particularly interesting aspect of the new shopping experience.

While B2B2C has become well established for the sale of non-food consumer goods such as fashion, books and consumer electronics via global online marketplaces, the food space still holds additional potential. Since 2017, online sales have increased steadily, with annual growth rates of over 15%. Delivery services, especially for the segment of fresh food on demand, are booming. B2B2C is increasingly winning over consumers who used to prefer doing their own shopping because of the long delivery times and high costs of home delivery.

For METRO, the resellers, who often operate online, are an additional customer group in numerous countries. As a wholesaler focusing on hotels, restaurants and catering (HoReCa) and Traders, METRO mainly targets professional clients who procure directly in wholesale stores or by delivery service (Food Service Distribution, FSD). Online, the METRO Marketplace specialises in the B2B sale of non-food articles, although end consumers can also shop on the platform. In the e-commerce sector, METRO has now recently introduced the B2B2C approach, while it has been a key practice ‘offline’ with Trader customers for decades. The term ‘Trader’ denotes the group of customers consisting of independent resellers such as small grocery stores, kiosks, street food vendors and fuel stations. When targeting these customers, METRO likewise looks not only at the B2B customers themselves (i.e. the Traders) but also the Traders’ own customers (i.e. the end consumers) in terms of both the personal advice and the product range.

In Russia, the B2B2C model has been running successfully since spring of 2020, when the pandemic hit, and operates as a supermarket delivery service with more than 20 delivery partners on board. Russia is an example of what is possible: high-quality products from METRO, which were previously reserved primarily for professional customers, are now available to end consumers. This cooperation has created a strong, new player in the e-grocery market, with good prospects for rapid expansion.

E-Grocery Russia

Poland:

In July 2021, MAKRO Poland launched a B2B2C pilot together with InPost, a leading player among European e-commerce delivery platforms. The companies are currently testing InPost Fresh with 3 delivery models in Warsaw: express delivery in up to 60 minutes, same-day delivery and next-day delivery. InPost Fresh mainly features fresh food, such as fish, meat, fruit and vegetables on its new food delivery app. Customers can conveniently pay either in advance or by card at pick-up. In the app, customers can also track the location of their products in real time.

Portugal:

MAKRO has been active in B2B2C sales in Portugal since November 2020 with its two partners, the Glovo dark stores and 360hyper stores. The cooperation with the Glovo dark stores, which are grocery stores explicitly designed for ultra-fast deliveries, is so successful that the partners are considering subleasing areas inside existing MAKRO stores. These mini-warehouses contain merchandise solely designated for the dark stores’ online sales channel. This way, goods that are in high demand online are already reserved and optimized for picking. The 360hyper online supermarkets were launched at the outset of the pandemic with the aim of offering customers a safe, convenient way to shop from the comfort of their own home. Both partnerships are experiencing stellar growth in sales, number of products and locations not only due to the rising demand in the market for fast e-groceries delivery, both also due to great interest & receptiveness of consumers towards MAKRO assortment.


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