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Use of B2B and B2C in Health Care
Business-to-Business (B2B) refers to the transaction that occur between two business institutions, for example, a transaction between a manufacturer and wholesaler (Investopedia, n.d.). B2B is popular in supply chain where one company source their products from the manufacturer then sell them to the consumers (or retailers for wholesalers). Manufacturers also purchase their raw materials from other business hence creating a B2B.
Business-to-Consumers (B2C) is where companies sell directly to the consumers. Consumers refer to the end users of the goods or services, for example, a person purchasing household items in a supermarket (Investopedia, n.d.). E-commerce has helped in expanding business-to-consumer trade model as consumers easily source their goods directly from the manufacturers. Besides, companies like Alibaba and Amazon are some of the leading organization that uses the B2C model. Particularly, technology is increasingly making B2C preferred model as the consumers by pass the middlemen that raises the cost of the products.
Both B2B and B2C trade model are used by different institutions involved in health care delivery. Business-to-Business is still very common, especially among pharmaceutical manufacturers as they either source their raw materials from other businesses or sell their products to wholesalers. It is impractical for the drug manufacturers to directly sell their products to the consumers considering they have a wide market reach. Additionally, a medical institution can strike a deal with another institution to offer their medical services to the employees hence creating a B2B model. On the other hand, Business-to-Consumers is on the rise as people directly source for their medical service providers. The increasing demand for personalized care also mean that hospital must restructure to meet the change in market structure.
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References
Investopedia. (n.d.). Business to Consumer – B2C. Retrieved from Investopedia: https://www.investopedia.com/terms/b/btoc.asp
Investopedia. (n.d.). Business-to-Business B2B. Retrieved from Investopedia : https://www.investopedia.com/terms/b/btob.asp