ONLINE ASSIGNMENT NO.

(Pakeeza Urooj)

(REGISTRATION # 20-ARID-25)
Assignment No. 1
(Pakeeza Urooj)
(Registration# 20-ARID-25)

Instructions:
Solve on the paper on this sheet, just change the name and Registration
number. You can add additional sheets
Return in stipulated time via email
Differentiate between various E commerce models. Explain in as much detail as possible. Do not
just copy the slides, but do some research.
ANSWER:
Following are some E commerce models.
PRIVATE LABEL:
Many new ecommerce entrepreneurs have great product ideas but no internal resources or
capacity to manufacture products themselves. So they order from manufacturers and then
label market and sell products under a private label.
ADVANTAGES:
Private-label products are developed, branded and sold by one company seprating it from
competitors. Private-label brand owners own the design, specifications, production technique
and have exclusive rights to sell under a private brand. Since they’re the only supply source,
private labels with good marketing can create a demand type and charge premium prices.
Private-label products typically enjoy very high profit margins. Brand owners take control of the
manufacturing an operation costs so they can minimize the cost of goods sold. And since
they’re the only sellers in the market, they can make strong margins from premium prices.
RISKS:
Finding the right private label manufacturers to collaboration with is a challenge. To minimize
the cost per unit, many enterpreneurs travel halfway around the world to developing countries
like China and Vietnam. They pay a lot of upfront capital to order large batches and lower per
unit costs.
Selling branded products online that are only sold by one vendor limits customer access.
WHITE LABEL:
Like the private-label model, white label retailers apply their brand names and resell generic
products purchased from a supplier. These businesses are free from the management of
manufacturing and quality control, but deal with extensive competition. White-label vendors
control package design, but not product specifications or quality. Since any reseller can sell
these products, competitors hardly have an edge in terms of unique selling points and use
marketing strategies and distribution channels to differentiate themselves.
RISKS:
Major issue white-label business owner deal with is inventory management. Most suppliers set
a minimum order quantity to achieve economies of scale by increasing production. As a
reseller, understanding the demand of your white-label products is critical. Mismanaging
inventory can leave white labels stuck with large batches of unsold inventory.
WHOLESALING:
As the name suggests, wholesaling is a business model where an ecommerce store offers
products in large quantities at discounts rates. Wholesaling used to be mostly a B2B business
practice. But thanks to internet, anyone can offer wholesale as a C2B or B2C practice.
Wholesale in ecommerce companies is quickly rising. Take for example Beard and Blade
doubling their revenue in the last 2 years and Laird Superfood increasing their annual revenue
550%.
DROPSHIPPING:
In recent years, dropshipping has emerged as a genius retail fulfillment model for ecommerce
beginners to launch with little to no capital. Dropshipping allows business to market and sell
products online without stocking inventory. As orders are placed dropshippers purchase items
from suppliers who then ship products directly to customers.
ADVANTAGES:
This business don’t need to pay for warehouse space, order or manage stock, pack or ship
products, track inventory or handle returns. Dropshippers can start with a small budget and
scale up as they’re ready with little financial risks.
RISKS:
With no product control, a bad supplier can burden customer-support teams and damage the
trust and credibility of a business. While the supplier manages the fulfillment process, the
business owner still needs to deal with delivery tracking issues.
PRINT-ON DEMAND:
The print-on demand model is similar to dropshipping-business sell custom desidns on a variety
of products like t-shirts, hoodies, leggings, mugs, phone cases and canvases. When an order is
placed, a third-party manufacturer prints the selected design on a product, packs its up in
branded packaging and delivers directly to the customer.