ASSESSING THE IMPACT OF E-COMMERCE ON PROCUREMENT SUPPLY CHAIN MANAGEMENT ( A CASE

STUDY OF MAPANGA FURNITURE)

1.1 INTRODUCTION

E-commerce is the fastest growth areaintheglobaleconomyand almost

carriespotentialsbeyondmeasure.Itprovidesconsumerswiththebenefitsofany

time, anywheretransactions,withlowercosts.Moreoverit,shortensthedistance

betweenthebuyerandthesellerandshrinkstheworldintoasmallvillage.(Porter,

2001;Alberta E-FutureCenter,2007)

Theuptakeof e-commerceisinfluencedbyitspotential tocreatebusiness

valueandbyawarenessofitsparticipantsofthepotentialbenefits(Salnoske,1997).

Amajorreasonformostcompanies,irrespectiveofsize,toparticipateinbusinessis

toextractsomebenefitfromit. E-commerceisnodifferent (Kuzic,Fisherand

Scollary,2002).Inhisresearch,Standing[2001]statedmorethanten e-commerce

benefitsforbothbuyerandseller.Suchascostsavingsandspeedinsellingand

purchasing, exposuretonewcustomers(globalreach),convenienceandtransparency

tousers, betterqualityofproduct/service(globalreach), reduceneedforofficespace

andfewerresources required(ecological).

Thedevelopmentofinformationtechnologyandcomputernetworksenhanced

theusageof ecommerceandimprovedthe useofsupplychainmanagement(SCM).

SCMfocusesontheintegratedplanning,coordinationandcontrolofalllogistical

businessprocessesandactivitiesinthesupplychaintodeliversuperiorconsumer

valueatlesscosttothechainasawhole,whilst satisfyingrequirementsofother

stakeholders,suchas consumerinterestorganisationsandgovernment. Eventually,the

completeimplementationoftheSCMconceptshouldresultinfullyintegrated,much

moreeffectivesupplychainswithfullinformationtransparencyandoptimal
allocationofvalue-addingprocesses (Mentzer&John,2001;Vorst,2002).

AlltransactionsaredoneinaspecificvirtualplacecalledBusiness-to

Business(B2B)electronicmarketplaces(e-marketplaces). E-marketplacesareoneof

the mostheraldeddevelopmentsinrecentyears.Thesemarketplacesbringtogether

businessesbuyingandsellinggoodsandservicesinanonlinebuyingcommunity. E

marketplacesproposetoincreasetheefficiencyandeffectivenessof procurement

activities byreplacingtraditionalmanualprocesses withautomatedelectronic

proceduresandbyexpandingthenumberofavailabletradingpartners(Koch2003;

Chong,Shafaghi,WoollastonandLui, 2010).

Accordingtoallmentionedabove,themainpurposeofthis studyis to

investigatetherelationshipamong ecommercebenefits,supplychainmanagement

1.2 BACKGROUND INFORMATION

According to Philippa (2000) said that, in the beginning of the century of 21st

electronic commence had popularstudy on researcher,many definitions of the

ecommerce were summarized.On the research of (E.Yen 2002), revealed that many

activities of selling and buying were transferred in to platform of electronics,

products and services were sold through computer networks.Atthe time being many

companies increasing to move their business activities toward the internet, therefore

the decision of these companies to invest their capital and much time inthese

business strategies many company they want to selltheir products through internet

purposefully to maximize their profit as much as possible through by creating online

visibility of their producessaid Sadah M (2000).

According to Ahmadu (2012), said that the economies based on communication and

information technology would contribute considerably to facilitate the inflow of

financial investments. Implementing on the web deal systems would offer developing

countries with the chance to display their organic and ocean reference endowments

to worldwide marketplaces through available details portals. E-commerce would help

their fast integration into the global economic climate also. The raising speed of

advancements and globalization in technology extend the traditional limitations of

agreement and business, therefore much to ensure that perform of digital business by

means of online transactions is definitely fast getting a globally phenomenon.

Based on the research of Benjaminin (1990), said that previouslyonline market was

funded proportional with the increase of internet development, furthermore there are

five key main drivers of theelectronic commerce which are Electronic data

interchange(EDI), electronic mail, facsimile(FAX), electronic Transaction

processing and Groupware. On the research of (Lui 2008) said that Ecommerce is

the way of doing business electronicallyin order to satisfythe organizationneeds or

personal objectives.

According to Khan and Xu (2005) said that sometimes e-commerce referredas the

online business is just creating visibility of your products and service within the

internet and executing purchasing though internet. Everyday the volume and success

of e-commerce in the web reported to increase, the environment of e-commerce

growswith high speed in which making information available worldwide. Emerging

of e-commerce has beenmade proper environment of reducing procurement process.

Based on the research of Min and Galle (2003), said that the common availabilityof

theweb and the availability of multiple browsers across differentplatforms provide a

common groundupon whichE-commerce applications can be developed and be

built, especially inthe enterprise. This platform has reducedthe significance of

issues pertaining to softwareavailability (distribution and installation),thus

encouraging the expansion of e-commerceviainternet.

According to Drye (1998) E-commerceis increasingbecause of the greater number

of businesses and individuals who are capable of usingthese networks and the

growing number of ways in which businesses can be purchased or procuredwithin

theorganizationanddirectly to consumers. At present, business-to-business(B2B) e

commerceseems still to be of greater volume than businesstoconsumer(B2C)e

commerce, but this mightchange in the near future. These trends are important to the

global economy and to the economy of individual countries because e-commerce

contributes to procurementeffectivenessand efficiency. Ecommercecontributes to

procurement efficiency in major five ways.