What Is A C2C Business Model?

Usually, businesses sell to customers, known as the business-to-customer or the B2C business model. For example, a retailer sells goods to buyers. Another business form that has existed for ages is the B2B model, wherein one business sells to another rather than the customers. For example, a manufacturer sells goods to a retailer.

In recent years, the third type of consumer-to-consumer or C2C business model has come into the picture. It involves customers selling to customers through online transactions using a third-party facilitator. For example, private sellers on Amazon and eBay sell to customers to generate a regular income. The e-commerce revolution has paved the way for this model, which is growing rapidly in the country with the rise of internet users and online shopping. If you are planning to start a venture or purchase a business for sale Brisbane, you need to know about this model.

How Does the C2C Business Model Work?

The C2C transactions are carried out in a virtual marketplace between individuals who are not businesses. In the past, such transactions took place with the help of newspaper advertisements and garage sales. For example, when an individual wanted to sell his old car, he would place an ad in the local newspaper. With the help of an e-commerce website, it becomes easier to find buyers for a C2C transaction because of the large number of users visiting these sites.

In this business model, the buyers have the advantage of finding products that are not easily available in the market. Also, they can get it at a lower price because it is sold by an individual instead of wholesalers or retailers who need higher margins. The seller has to only pay a small commission to the marketplace for listing his products for sale.

Types of C2C Business Model Platforms

With the advancement in technology and the increasing confidence of buyers in online transactions, the number of e-commerce platforms has risen. It is easy to find dedicated websites for different C2C business models listed below.

• Exchange of Goods

An e-commerce website that allows individuals to sell goods to other individuals creates an exchange of goods channel. For example, a private seller can sell used books, musical instruments, furniture, vehicles, etc., through this platform. Some of these sites allow the transaction to be completed offline by allowing the two individuals to contact each other and meet in person before closing the deal. It helps the buyer to check the product before making payment.

• Exchange of Services

The C2C business model can also sell services from one customer to another. For example, a real estate agent or a fashion designer sells his services to buyers. If you purchase a business for sale in Brisbane that was run by one person offering his skill as a service through an e-commerce platform, you will be working on the same model. Several individuals are using this platform to start a small business with low investment because they do not have to spend on office and set-up.

• Payment Sites

The platforms that allow only the listing of goods and services for sale on their site are the payment platforms. These also help to complete C2C transactions on other platforms. They charge a commission from users for transferring their earnings into their accounts.

• Auction Sites

The auction site is a marketplace where the sellers list their goods for a minimum price, and the buyers have to bid until the winner is chosen. It helps buyers find a product at a lower price if there are few bidders.

Pros of Using A C2C Business Model

A customer-to-customer business model has a few advantages that buyers and sellers can leverage. Let us look at them.

• Cost-Effective Transactions

The sellers directly list their products on the platform without intermediaries' interference, which helps them sell at a higher profit margin. They do not have to pay for the marketing and distribution of the products and can find customers quickly. Also, the buyers can get products at a bargain price for the same reason.

• Excellent for Used Products

Many buyers are looking for cheaper products and can easily find them through C2C platforms. These have listings of old and used products like kid's toys, furniture, cycles, books, etc., that are in good condition and can be used by others. Also, the seller can profit by selling it instead of donating or discarding it. Thus, it saves the environment through the propagation of reusing and recycling.

• Sell to A Wide Customer Base

The sellers can sell their products to an extensive customer base in the C2C marketplace. It is easier for them to find buyers for products not sold otherwise, such as niche items like handmade crochet apparel.

• Easy and Comfortable

Online shopping is far more convenient than physical shopping for buyers as they can sit in their homes, browse through the products, compare prices and then purchase online. The product gets delivered to their homes without any hassle or challenge.

Similarly, sellers do not have to own a shop or advertise their brand across the state to sell their products. They can simply create an account on the virtual marketplace, list their products and start selling. They don’t even need an e-commerce website.

Cons of Using A C2C Business Model

A C2C marketplace can pose certain challenges that make it less credible in the eyes of the buyers. Let us look at them.

• No Quality Checks

Unlike a business that sells high-quality products to attract and retain customers, C2C platforms do not have control over the quality of goods sold. The seller may sell a damaged product to the buyer, which affects the trustworthiness of the customers. It is easy to get deceived or swindled through these sites because the buyers deal with individuals, not companies, which can be held accountable.

• Absence of Payment Gateway

Only some C2C marketplaces have a payment gateway. Some depend on cash on delivery methods or a third-party payment platform. Thus, it can become a bit inconvenient for the buyers.

Conclusion

Although business owners do not have to worry about competition from the C2C business model, they should know its performance and popularity. The growing use of online shopping makes it a tough contender in the race to attract target audience.