Business-to-business (B2B) describes commerce transactions between businesses, such as between a manufacturer and a wholesaler or a wholesaler and a retailer. B2B transactions involve many classifications of business products, including the following:
- Raw Materials: A raw material is the basic material from which a product is manufactured or made. Agriculture and mining businesses are concerned with the production of raw materials, such as plants or minerals. Additional examples include latex, iron ore, logs, and crude oil.
- Component Parts: Manufacturers produce products, from raw materials to component parts, which they then sell at a profit. Companies that make physical goods, such as cars or pipes, are considered manufacturers.
- Equipment: Equipment includes products used in production activities and operational activities. Equipment includes large buildings that serve as places of business for other companies. Real estate businesses generate profit from the selling, renting, and development such of properties.
- Processed Materials: These products are created from raw materials and are used in the production of another product. Examples include food preservatives and industrial glue.
- Business Services: Service businesses offer intangible goods or services and typically generate a profit by charging for labor or other services provided to government, other businesses, or consumers. Organizations including house decorators, repair services, consulting firms, restaurants, financial businesses, janitorial services, and even entertainers are types of service businesses. ( )
- Supplies: These products facilitate both production and operations, but are not part of the final product. Examples include paper, pens, and cleaning agents. These items can be purchased from retailers and distributors and delivered by transportation businesses.
There are many other divisions and subdivisions of businesses. The authoritative list of business types for North America is generally considered to be the North American Industry Classification System (NAICS; pronounced "nakes"). The equivalent European Union list is the Statistical Classification of Economic Activities in the European Community (NACE).