E-commerce as a Valid Business Opportunity for New and Existing Business - Essay Example

E-commerce as a Valid Business Opportunity for New and Existing Business Name Professor Date E-commerce as a Valid Business Opportunity for New and Existing Business The unparalleled communication technology development has led to a rapid increase of the users of the internet. In the process, internet has presented a platform where people not only communicate but also transact businesses. According to Gangeshwer, online shopping is continuously changing the mode of purchasing products and service across the globe as most people do not need to meet to conduct their businesses1. It has saved business people cost of marketing and travelling. Electronic commerce and electronic business has been found to have numerous advantages based on access to and choice of products and services. Presence of virtual markets and stores has enabled access of products or services anywhere across the globe without possibly leaving home. Nanehkaran contended that the US, the UK and Australia are toady ranked as the top countries where businesses and consumers have benefited significantly with growth of E-commerce and E-business2. Even though the two words E-commerce and E-business have been used synonymously, there are some clear distinctions between them. Therefore, this paper will compare and contrast e-commerce and e-business by giving examples and discussing the difference between the business processes and evaluate how the Internet can support business growth with the use of e-commerce principles. As mentioned earlier, even though e-business and e-commerce are interchangeably used on online business, the two concepts are distinct. According to Beynon-Davies E-business is defined as the use of information and communication technology to improve business3. The practice incorporates all processes that the company carries out over a computer-guided network. E-business can also comprehensively be defined as the transformation of processes with the organization to provide customer value the use of technologies, computer paradigm and philosophies. On the other hand, in 2000, Andrew defined electronic commerce as the transaction of products and/or services by means of computer networks4. The E-commerce brings on board technologies like mobile commerce, supply chain management, electronic funds transfer, internet marketing, inventory management systems and electronic data interchange. Technically, Agrawal et al., claimed e-commerce is that application of ICT just to aid in doing business between businesses to consume consumer, departments and inter-organization across the network5. In a nutshell, electronic commerce is simply buying and selling of products and service over the electronic platform such conducting banking transaction. On the other hand, Bensebaa argued that electronic business besides incorporating electronic business, it takes into consideration both back and front-office application which works as the engine for the contemporary electronic business6. Electronic business also incorporates e-commerce and also internal processes like product development, inventory management, production, risk management, knowledge management, finance and human resources with an aim of cost saving. Therefore, e-business entails not just developing a company’s website and accepting credit card fees but basically re-structuring of the company by means of technology by adoption of systems such as enterprise resource planning, customer relationship management, supply chain management, data mining, data warehousing and data marts7. Internet has been found to great support the growth of through electronic commerce platforms. Increase in the use of internet has made developers to work day and night with the intention of creating applications and platforms for communication and doing business. Niranjanamurthy et al. posited that as a result of various sophisticated internet technologies like intranet, extranet, social networking, websites, accounting software and management software have been developed to improve growth of e-commerce8. Internet supports group of business through online money transfer. Today, many companies have emerged which can facilitate transfer of money from online account to a bank account to their mobile phones. Similarly, people can now buy products or service in any part of the world and pay through online money transfer. Laudon and Traver has stated that internet has led to what is termed as a new economy where massive growth has been registered, and the process has changed people’s perception of conventional means of conducting business9. The way of conducting business online is referred to as click and mortar and dominated by firms like Ebay and Amazon. Internet has supported growth of business through improving corporate image. Niranjanamurthy et al. argued that business which involves themselves in e-commerce such as selling products and services on the online platform creates a good corporate images and presence10. In most cases today, people lowly rate companies which have no websites. Technology supports the growth of business profits by cutting costs and increasing access. Agrawal et al. affirmed that e-commerce reduce cost of transport and marketing since with website presence, the management does not need to go another country to market their products and services11. The new internet technology enables a company or a consumer to initiate procurement, billing and shipping. Today, various business models of e-commerce have been devised in the recent years. These have helped improve the growth of online because it enables companies to create networks with consumers and governments. According to Laudon and Traver, there are two major business models of e-commerce consists of business to business commonly referred to as B2B and Business to consumer often abbreviated as B2C12. The Business to Business model entails business deals for ordering and buying over online platform, and other administrative duties between residences. It consists of trading products like professional services, business subscriptions, wholesale dealings and manufacturing. In some situations of B2B model, transactions could take place exist between the virtual firms which do not have physical presence. An example is a transaction between Amazon.com which sells books on online bookstore from different publishers such O’Reilly, Wrox, Premier Press, etc. B2B is effective in maintenance of supply chain between companies. The transaction between the two firms is termed B2B model. The Business to consumer (B2C) model takes into consideration transactions between a company and its consumers. Here, a company shows its products or service through catalogue such as health information, banking service and travel service and when a consumer feel it can satisfy his or her needs they click to buy. As internet continues to grow, there have been emerging models in the e-commerce for the last five years. According to Laudon and Traver, some of the emerging e-commerce models include Government to Government normally referred to as G2G and Government to Consumer abbreviated as G2C. Government to Government model entails the business between two states13. An example can be the US government buying oil from the government of Saudi Arabia. Government to Consumer is a business between government and individual consumer. An example of G2C is where an individual paying tax using an online platform. In conclusion, the evolution of internet has brought new potential and challenges for individuals, businesses and government. E-business and E-commerce has developed as a new concept in business where people must not meet to conduct their business transactions. The adoption of E-business and E-commerce has enabled companies to improve corporate image, reduce cost of operation and the speed of business. Despite the two terms being used alternately, the essay has demonstrated a clear distinct between E-business and E-commerce. While e-commerce is simply means doing business on the internet networks, e-business goes beyond e-commerce and encompasses the internal processes like product development, inventory management, production, risk management, knowledge management, finance and human resources. Despite the growth, E-business and E-commerce faces challenges such privacy and security which the companies must improve. Bibliography Gangeshwer, D. K, ‘E-Commerce or Internet Marketing: A Business Review from Indian Context’, International Journal of u-and e- Service, Science and Technology Vol.6, No.6, 2013, pp.187-194 Andrew, B 2000, The Difference between E-commerce and E-business, Retrieved 22 June 2015 Agrawal, D R, Agrawal, P, Singh, J.B & Tripathi, S.P, ‘E-commerce: True Indian Picture’, Singh, N., Alhorr, Hadi S., Boris P. Bartikowski, Global e-commerce: a portal bridging the world Markets’, Journal of Electronic Commerce Research, Vol. 11, No. 1, 2010, pp.1-5 Beynon-Davies, P , E-Business, Palgrave, Basingstoke, 2004. Bensebaa, F, ‘The impact of strategic actions on the reputation building of e-businesses’, International Journal of Retail & Distribution Management, 32, 2004, 286 – 301 Laudon, K & Traver, C, E-Commerce: Business, Technology, and Society, New Jersey:Prentice Hall, 2009. Niranjanamurthy, M, Kavyashree, N Jagannath., DR & Dharmendra, C, ‘Analysis of E- Commerce and M-Commerce: Advantages, Limitations and Security issues’, International Journal of Advanced Research in Computer and Communication Engineering, Vol. 2, No.l6, 2013 pp. 2360-2370 Nanehkaran, Y.A, ‘An Introduction to Electronic Commerce’, International journal of scientific & technology research, Vol. 2, No.4, 2013, pp.190-193 Read More