In recent years, the use of Internet commerce has grown drastically. The fastest increase has been in US, where the Internet usage and E-commerce has largest impact. The emergence of the Internet has been a major contributing factor. Where advances in telecommunications and computing largely occurred side-by-side in the past, today, they converge on the Internet. In its most basic sense, electronic commerce can be defined as conducting or enabling the buying and selling of goods or services through electronic networks, including the Internet. In my position paper I would first tell you some arguments about e-commerce, summarize some articles about e-commerce and also give some steps and valued opinion when enetering e-commerce.
Companies are using electronic commerce to enter new markets that would have otherwise been excluded from due to geography, cost, or other reasons. Companies look to electronic commerce to extend their products to new sets of customers and new parts of globe. The Web enables a company to introduce a new product into the market, get immediate customer reaction to it, refine and perfect it, all without incurring huge investment in a physical distribution infrastructure or buying a shelf space at a retailer of distributor. (E-commerce, 2000)
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When the product is right, the company can launch it through traditional channels with much greater assurance of its success. One of the biggest attractions of electronic commerce is its ability to help companies lower the costs of doing business.
Article “Managerial Issues for expanding into International Web-Based Electronic Commerce”talks about how Expansion into foreign markets raises issues of language, cultural, technological, domain name and business practise variances. Author talks about how when developing the web page we should internationalizing the web site. I agree with him because multilingual sites are key to a globally conscious organization. The article is writing that to be fully able to use the advantages of e-commerce there must be defined steps, which would ensure that whole system would work permanently. Provide confidentality of payment information and enable confidentality of order information transmitted along with the payment information. Another step is to ensure the integrity of all transmitted data. Businesses are restructing around the idea of connectivity. Connectivity means 24-hour call centers, 24-hour live help via interactive chat sessions on its Website, and online supply-chain management among buying and selling customers. Another good point in the article was that e-commerce over Internet also increases the danger of misusing the information used during the e-business.
Author is writing that in order of e-commerce to become e-business enabled the manager should develop a dynamic, database-driven online catalog. Second, he should provide for online ordering.. And the last, accept electronic payment methods (credit card, EFT, etc.) for full-transaction shopping or bill payment. These are all good points because by using e-business based e-commerce companies can improve margins by using a lower-cost online channel. They can also reduced costs associated with paper based processed: postage, printing and handling. And finally, give customers faster, more responsive service.
Second article “Tapping the power of commerce”deals about how movement of our global economy to E-commerce is one of the most important trends. Author stated:
Associations must learn to use information technology and e-commerce not only to better manage their affairs but also to compete and survive in the emerging digital economy. (Tapping the power of commerce, 1999)
According to article we have to be ready for the changes that are taking place in our business world and to stay focused on e-commerce. To find out about our future customers and competitors and what will be our competitive advantage we should try to foresight. Forecasting begins by identifying what could happen tomorrow and then determinates what must happen in the interim to accomplish the desired result. (Tapping the power of e-commerce, 1999)
One good point about e-commerce is that actually company is open for business whenever a customer needs it. Electronic commerce presents a new sales and marketing channel which can increase product or service awareness, offer low-cost access to new geographical markets. I agree with the autor that the more and more businesess are realizing the following value elements from electronic commerce solutions: reduced costs, improved customer service, entrance into new markes, newly sales channels and increased global reach. Both on the other hand, businesses and other organizations must be prepared to meet the challenges of the digital age. Companies need to understand how electronic commerce will affect their relationship with their competitors, their distribution channels, and their customers. As new companies in an industry build electronic channels, established rivals will need to reexamine their value chains. New companies can actually take advantage of the Internet. For example, although a book publisher might be tempted to use the Internet to sell directly to bookstores or even to readers, it runs the risk of damaging long-standing relationship with distributors. However, companies may find they have a little choice but to risk damaging relationship in their physical chains to compete in the electronic channel. Not only could the book publisher bypass the distributor and sell directly to the readers, but for example, Barnes & Noble and Amazon.com could decide to publish their own books – they have a very good information, gathered and collated electronically, pertaining to reader’s interests. The implication is that Internet allows companies to bypass others in the value chain. A company could conceivably use the Internet to become the dominant player in the electronic channel of a specific industry or segment, controlling access to customers and setting new business rules. (Making business sense of Internet – powerpoint presentation by Shikhar Ghosh)
The Internet might have opportunities for creating new value by taking away bits of someone else’s business. First a company can use its direct access to customers, each time a customer visits a company’s Website is an opportunity to deliver additonal value. The economy is moving in the direction of near universal connectivity of people to people and people to information.
In my opinion business online is more of an evolution than a revolution. In most cases it will not radically change the existing order of things but rather intergrate and reshape the way work is done and commerce is conducted. The Internet will supplement existing chanels, while providing significant benefits and opportunities to those companies that are quickest to determine how best to use this new channel.
Internet sales in 2002 reached around $14 billion and 80% of the global Fortune 2000 companies each have a Website. (Dot-com Companies: Are they all hype, 2002)
In this article, author talks how e-commerce is actually destroying jobs and burning billions in investment capital. Globalization demands adaptations for unimpeded access in new markets and heightens legal and regulatory concerns. Economic issues, financial market risk, language, political and social differences can arise as companies expand beyond their home base. The failure rate of dot-coms is close to 75% in their first two years (Dot-Com Companies: Are they all hype, 2002) I think that the failure of dot-com company can actually have an impact of their merchandise suppliers. This suppliers will face a hard time with debts after supplying these failed dot-coms. This is because over 90% of businesses failed to check the credit card of dot-coms before supplying them. (Dot-Com Companies: Are they all hype, 2002)
According to the author, the major differences between e-tailers and traditional retailers is the time it takes to return an item. Many e-tailers fail to assist their customers satisfactorily in their return processes. (Dot-Com Companies: are they all hype?)
Another problem of the e-commerce is internet/data privacywhich is at risk in a high security environment, which is the current case worldwide. Laws and regulations concerning privacy, Internet taxation, reuse of information , access for children and other aspects continue to affect information sharing practices. Most companies that are using e-commerce are feared that transactions executed electronically may not be captured. Companies that leverage the Internet for collaborative product design and distribution also face increased threats from piracy if products and delivery methods are not secure.
My next opinion is that countries with a less mature e-commerce market presents opportunities for dominant players from mature markets. A lack of dominant players and lower costs to invest in and acquire high-quality players are key benefits.
Electronic business means different things to different companies. Businesses use information to establish new customer realtionship, and deliver value to customers in new ways. Gathering, organizing, selecting and distributing information can improve operations, create new markets and new relationship. Creating a successful e-business means more than simply choosing the right technology, Web enablling the right process, or forging the right Internet links to legacy systems. It also requires fundamental changes in organizations, corporate behavior, and business thinking.
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