E-Commerce

What is Electronic Commerce?

Electronic commerce is the use of IT systems to carry out the inter-organizational business processes of buying and selling goods and services. Put simply, it is a means of transacting business electronically, and in many cases, over the Internet. It involves a composite of technologies, processes and business strategies that foster the instant exchange of information within and between organizations, buyers and sellers.

Historically, E-Commerce has been divided into two categories:

1. Business-to-Business (B-to-B), involving electronic, business transactions between businesses. This typically involves transactions between trading partners.

2. Business-to-Consumer (B-to-C), involving electronic business transactions between a business and an individual consumer.

The value of business-to-business electronic commerce to the user is:

• Greater accuracy.

• Faster order processing.

• Lower procurement and operational costs.

• Better coordination among sales, manufacturing and purchasing.

• Sellers become preferred suppliers when they offer electronic commerce.

• Purchasers become preferred business partners when they use electronic commerce.

• The Internet becomes an additional channel for sales, marketing and public relations activities.

The value of business-to-consumer electronic commerce for the business includes:

• It extends the geographical reach of the business.

• It allows businesses to serve their customers seven days a week and 24 hours a day.

• It is built around the Internet, which is an exciting new phenomenon for consumers.

• The consumer does most of the work involved in entering and checking orders, thus saving the business time and money.

• Consumer accounts are already on the computer and thus they are easier to track for marketing purposes.