Business to business: B2B is the term for a business-to-business transaction. In this type of transaction, one business establishes a contract or an agreement with another business. This generally happens when: one business wishes to hire another business to work for them and they need the services of another business; one business wishes to buy another business from another business; or one business wants to sell their products or services to another business. A business-to-business transaction is often initiated by a marketing strategy such as establishing joint venture partnerships. But sometimes, a business-to-business transaction can occur without a marketing strategy or without any marketing at all.
How to close a business to business deal? When you sign a sales agreement or contract with a potential business partner, it’s important that both parties thoroughly understand and commit to one another’s goals and strategies for achieving those goals. To close a business to business deal, the following tips can be quite helpful:
* If you are going to hire a B2B service to help you market your company, be sure to get the agreement written down. The sales agreement is often the part that will prove most sticky for the seller. The language in the agreement should include the scope of the services to be provided, the price, dates and other important information. You want to make sure that your potential business partner knows exactly what he is agreeing to in the contract. If you have a good understanding of how a business to business sale works, writing the agreement will be easier for you. However, if you don’t feel comfortable with the language in the sales agreement, a business to business counselor may be able to help you with it.
* It’s important for the seller to understand what he is getting out of the sale as well. If the seller is paying a high price for advertising services, he may not get the full value of his investment. For this reason, he needs to be made aware of any possible loss through overages and other fees that may be incurred during the course of the B2B deal. In addition, he needs to be made aware of any possible source of capital that could give him the funds he needs to make the payments on the services.
* Be clear on the terms of payment. You want the seller to be clear about whether the buyer’s money will go first, second or third and as quickly as possible. Many B2B transactions end up with one party retaining the money while the other sells the goods at a higher price. If you are going to use the services of a business to business broker, he should be willing to break the seal agreement if it provides more time for the seller’s buyer to receive his payments. This way, both sides benefit.
* One thing that is important to the seller is to know what his responsibilities are going to be. Many sellers try to save costs by providing the business with the services without being clear on what those responsibilities are. This can lead to problems in the future such as disputes. The best business-to-business B2B deal will have clearly defined roles and duties. Always be clear and upfront on those things before signing any contract.