A

Paper Presentation
On
E-COMMERCE
At
Jind Institute of Engineering and Technology
Jind, Haryana

Author
RAHUL JAIN
1609713
MBA 3RD SEM.
Student, Department of Business
Administration
Jind Institute of Engineering and Technology
Email Id: [email protected]
KEY WORDS
 INTRODUCTION
 HISTORY
 APPLICATIONS
 TYPES
 DRAWBACKS
 BENEFITS
 CONCLUSION
 BIBLIOGRAPHY
INTRODUCTION:

There does not exist a simple definition of E-Commerce that adequately describes the
coverage of its operations, functions and underlying technologies. One common view is:

E-Commerce is online shopping via the Internet.

Although this is correct, online shopping is only one of many types of E-Commerce
activities. In broader terms:

E-Commerce is any commercial activity conducted electronically, particularly via private or

open networks, such as the Internet.

The key point of this definition is that E-Commerce is a confluence of business operations
with electronic and network technologies. Telephony and non-networked technologies such
as CD-ROM media may integrate into operations, but the core of E-Commerce is network
technologies and especially open networks such as the Internet.

Electronic Commerce or e-commerce is the trade of products and services by means of the
Internet or other computer networks. E-commerce follows the same basic principles as
traditional commerce that is, buyers and sellers come together to swap commodities for
money. But rather than conducting business in the traditional way in shopping stores or
through mail order catalogs and telephone operators — in e-commerce buyers and sellers
transact business over networked computers.

It is also true to say, however, that eCommerce also includes all inter-company and intra-
company functions (such as sales, marketing, accounts, logistics, manufacturing, and
negotiation) that enable commerce and use electronic mail, EDI (Electronic Data
Interchange), file transfer, digital fax, video conferencing, workflow, or interaction with a
remote computer.

E-Commerce also includes buying and selling over the World-Wide Web and the Internet,
electronic funds transfer, smart cards, digital cash, and all other methods of completing
business transactions over digital networks.
Electronic commerce, commonly known as e-commerce or eCommerce, consists of the
buying and selling of products or services over electronic systems such as the Internet and
other computer networks. The amount of trade conducted electronically has grown
extraordinarily since the spread of the Internet. A wide variety of commerce is conducted in
this way, spurring and drawing on innovations in electronic funds transfer, supply chain
management, Internet marketing, online transaction processing, electronic data interchange
(EDI), inventory management systems, and automated data collection systems. Modern
electronic commerce typically uses the World Wide Web at least at some point in the
transaction's lifecycle, although it can encompass a wider range of technologies such as e-
mail as well.

A large percentage of electronic commerce is conducted entirely electronically for virtual

items such as access to premium content on a website, but most electronic commerce
involves the transportation of physical items in some way. Online retailers are sometimes
known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers
have electronic commerce presence on the World Wide Web.

Electronic commerce is generally considered to be the sales aspect of e-business. It also

consists of the exchange of data to facilitate the financing and payment aspects of the
business transactions.

HISTORY

Electronic Commerce (or e-commerce) really began as Electronic Data Interchange (EDI),
the application-to-application transfer of business documents between computers. Many
companies use EDI to exchange business documents. EDI uses telephone lines as a fast,
inexpensive, and safe method for sending purchase orders, invoices, shipping notices, and
other frequently used business documents. It eliminates the need for sending paper
documents via mail, faxes, or telexes. EDI is a major contributor to creating a paperless office
environment.

Companies that exchange documents by EDI are called "trading partners". EDI requires that
its trading partners evaluate business procedures and invest in and learn about special
software and hardware, communications, standards, audit issues, and legal support
necessities. EDI does require investment up front.

E-COMMERCE APPLICATIONS

Some common applications related to electronic commerce are the following:

 Email
 Enterprise content management
 Instant messaging
 Newsgroups
 Online shopping and order tracking
 Online banking
 Online office suites
 Domestic and international payment systems
 Teleconferencing
 Electronic tickets

E-COMMERCE TYPES

There are different types of today e-commerce such as :

1- Business to Business (B2B)

Business-to-Business e-commerce has been around for some time. Over 90% of all e-
commerce transactions on the Internet are B2B. B2B enables automating transactions
between trading partners for business efficiency. B2B is also known to be Electronic Data
Interchange (EDI).

2- Business to Consumer (B2C)

Business-to-Consumer is considered to be one of the best things to happen for e-commerce

and the Internet. It continues to grow by leaps and bounds with every passing day. Popular
websites such as Amazon and like have cashed in over the rise of purchases that happen over
the Internet. B2C involves direct selling to the consumer over the Internet. The service or
product that is being sold does not necessarily be virtual or intangible, but as a matter of fact
most transactions that happen are related to tangible goods.

3- Consumer to Business (C2B)

Consumer-to-Business model is a complete reversal of Business-to-Consumer model. In a

Consumer-to-Business Model a consumer offers goods or services to companies and the
companies pay for them. We can see examples of C2B in forms of affiliate marketing,
answering online polls for companies, being a free lance developer, etc.

4- Business to Employee (B2E)

In a Business-to-Employee e-commerce, companies offer products or services to their

employees in an intranet environment. B2E typically is used for automating employee related
work processes. Examples of B2E applications can be seen in online insurance policy
management for employees, offers and rewards program for employees, etc.

5- Consumer to Consumer (C2C)

In Consumer-to-Consumer e-commerce a third party builds a transaction bridge between two

or more consumers involved. Online Auctioning can be considered to be a good form of
Consumer to Consumer e-commerce model where consumers set up sale of goods and
services for other consumers where other consumers have to bid and win the specific good or
service. The third party which connects consumers charges a nominal fee for their services.
They are in no way related to the goods and services being sold or bought and they are not
responsible for QA and other such factors.

DRAWBACKS OF E-COMMERCE

Delivery time

Physical goods take some time to reach your home when you buy them online whereas if you
go to the local store and buy them, you can get them instantly. Delivery times may range
anywhere from a day to even a month. Moreover, perishable goods cannot be considered to
be shipped for such long delivery times as they tend to get destroyed during transit.
Hesitancy

Most customers and businesses are hesitant to do transactions online. This is due to the fact
that if a person wants to feel the service or goods he is paying for, he lacks that on the
Internet. Moreover, some people are accustomed to shop with family and friends and hang
out to malls and big outlets, which is otherwise unavailable on the Internet.

Online safety

Online safety is a critical factor that most people consider before even thinking of performing
commercial transactions. Customers and businesses should be assured of privacy
implications, confidentiality, security and like factors. An amount of trust has to be developed
before starting or involving into transactions.

Other drawbacks

One of the biggest drawbacks of e-commerce is that many people may not be satisfied with
the virtual experience of trading and buying products lying possibly thousands of miles away
just by seeing its picture. International trade, import/export and global sourcing all involve
great geographical distances spanning over continents or nations, and this lack of physical
proximity comes to the disadvantages sometimes. Secondly the question of safety of
payments and trust is also there which will be discussed in detail in another article. For many
people e-commerce is not about big international trade, import/export or global sourcing but
simply about enjoying shopping over the net, and sometimes the electronic experience does
not satisfy their social needs or holiday lust hence they become distanced to the concept of e-
commerce. From the seller's point of view, e-commerce does not offer a direct face to face
proximity with the probable customer and therefore things may not work out the way they
would have done otherwise.

BENEFITS OF E-COMMERCE

In the short-term, entry into E-Commerce may offer a competitive advantage over slower to
act competitors. The market for E-Commerce is growing; as more consumers and businesses
gain Internet access and transaction processing technologies improve security. Companies
that establish an operation today, still in the early stages of Internet based E-Commerce, will
have a fuller understanding of the issues and be better prepared to capitalize on emerging
technologies when E-Commerce markets open up in the next few years.

The benefits of E-Commerce to a small business may include capabilities to:

Extend the range of sales territory

Streamline communication to suppliers and clients

Expand reach to new clients

Improve service to existing clients

Reduce paperwork and time spent on correspondence

Track customer satisfaction

Expedite billing

Improve collaboration on work projects

Expand markets beyond geographical, national boundaries

Leverage legacy data

Improve inventory control, order processing

Establish position in emerging E-Commerce marketplace

Lower costs of overhead

Realize economies of scale by increasing sales volume to new markets

Monitor competition and industry trends

Improve or expand product lines - locate new suppliers, products that could be included
in catalogue.
The benefits to organizations are as follows:
1- Electronic commerce expands the marketplace to national and international markets. With
minimal capital outlay, a company can easily and quickly locate more customers, the best
suppliers, and the most suitable business partners worldwide. For example, in 1997, Boeing
Corporation reported a savings of 20 percent after a request for a proposal to manufacture a
subsystem was posted on the Internet. A small vendor in Hungary answered the request and
won the electronic bid. Not only was the subsystem cheaper, but it was delivered quickly.

2- Electronic commerce decreases the cost of creating, processing, distributing, storing, and
retrieving paper-based information.

3- Ability for creating highly specialized businesses.

4- Electronic commerce allows reduced inventories and overhead by facilitating “pull”-type

supply chain management. In a pull-type system the process starts from customer orders and
uses just-in-time manufacturing.

5- The pull-type processing enables expensive customization of products and services, which
provides competitive advantage to its implementers.

6- Electronic commerce reduces the time between the outlay of capital and the receipt of
products and services.

7- Electronic commerce initiates business processes reengineering projects. By changing

processes, productivity of salespeople, knowledge workers, and administrators can increase
by 100 percent or more.
8- Electronic commerce lowers telecommunications cost-the Internet is much cheaper than
VANs.

9- Other benefits include improved image, improved customer service, newfound business
partners, simplified processes, compressed cycle and delivery time, increased productivity,
eliminating paper, expediting access to information, reduced transportation costs, and
increased flexibility.
The benefits of EC to consumers are as follows:
1- Electronic commerce enables customers to shop or do other transactions 24 hours a day, all
year round, from almost any location.

2- Electronic commerce provides customers with more choices; they can select Electronic
commerce frequently provides customers with less expensive products and services by
allowing them to shop in many places and conduct quick comparisons.

3- In some cases, especially with digitized products, EC allows quick delivery.

4- Customers can receive relevant and detailed information in seconds, rather than days or
weeks.

5- Electronic commerce makes it possible to participate in virtual auctions.

6- Electronic commerce allows customers to interact with other customers in electronic

communities and exchange ideas as well as compare experiences.

7- Electronic commerce facilitates competition, which results in substantial discounts.

The benefits of EC to society are as follows:

1- Electronic commerce enables more individuals to work at home and to do less traveling for
shopping, resulting in less traffic on the roads and lower air pollution.

2- Electronic commerce allows some merchandise to be sold at lower prices, so less affluent
people can buy more and increase their standard of living.

3- Electronic commerce enables people in Third World countries and rural areas to enjoy
products and services that otherwise are not available to them.

4- This includes opportunities to learn professions and earn college degrees.

5- Electronic commerce facilitates delivery of public services, such as health care, education,
and distribution of government social services at a reduced cost and/or improved quality.
Health-care services, for example, can reach patients in rural areas.

6- Expands markets from local to global

7- Reduces costs with telecommunications and physical maintenance

8- Large portals enable large product bases, manufacturers and prices

9- Search utilities far surpasses the speed used to find products through catalogs

10- Encourages competition between small and large online retailers

LIMITATIONS OF E-COMMERCE

1- There is a lack of system security, reliability, standards, and some communication

protocols.

2- There is insufficient telecommunication bandwidth.

3- The software development tools are still evolving and changing rapidly.

4- It is difficult to integrate the Internet and EC software with some existing applications and
databases.

5- Vendors may need special Web servers and other infrastructures, in addition to the
network servers.

6- Some EC software might not fit with some hardware, or may be incompatible with some
operating systems or other components. As time passes, these limitations will lessen or be
overcome; appropriate planning can minimize their impact.
CONCLUSION:
Most of the disadvantages of electronic commerce stem from the newness and the
rapidly developing pace of the underlying technologies. These disadvantages will disappear
as electronic commerce matures and becomes more available to and accepted by the general
population and takes E-Commerce towards the winning post of a challenging journey.
BIBLIOGRAPHY

www.wikipedia.com

www.answer.com

www.ebay.com

BOOKS

Sushil Goyal