Term 1: Topic 6 E-COMMERCE

What is ecommerce
 Ecommerce (electronic commerce or EC) means buying and selling goods and services on the
internet or world wide web. Online retail selling is now commonly referred to as e-tailing.
 E-Tailing refers to retail selling that taken place online. This is the process whereby
customers use the internet to purchase goods rather than travelling to the stores
themselves.

Characteristics of ecommerce:
a) Use of websites
Websites are components available on the WWW (world wide web) and using e-
commerce websites you can do online shopping which is really convenient and
efficient.
b) Bricks and clicks
Brick-and-Click is a business model in which a company operates both an online
store (the clicks) and an offline store (the bricks) and integrates the two into a
single retail strategy.
c) Availability of wide range of goods.
Many stores offer a wide range of products online than they carry in their retail
outlets. And many stores that solely exist online may offer consumers exclusive
inventory that is unavailable elsewhere.
d) Delivery to customer
Consumer purchase goods online get their product delivered on their door-step.
Consumer look for the cheapest delivery option possible with no preference for
when their goods are delivered, while others need it faster and are willing to pay
for a more efficient service.
e) Return options.
Return options is an option for consumers to return back the products that they
purchased back to the retailers or manufacturer due to damage and malfunction
product. Consumers aspects to get back replacement product or refund of money
for the products that being returned.
Effects of e-commerce:
a) Change in supply
 Ecommerce has increase the process on supply of the goods. The goods
that need to sell to consumer that ordered through e-commerce need be
packed, labelled and shipped to a provided address. This increased the
cost of logistics, they also create a workload that has to be managed.
b) Supplying direct from warehouse
 Ecommerce made the seller to sell the product directly from warehouse. E-
commerce can reduce costs for consumers when companies cut down on
middlemen involved in distributing goods.
c) Communication through online orders
 Buyer and seller communicating through the platform of e-commerce
which allows the buyer to place the order and seller can respond to the
order immediately. Communication through online make the
communication to be cheaper and faster.
d) More national and international customers
 E-commerce provide the advantage for consumer to used it anywhere in
world as long there is internet connection. This allow consumers from
national and international to use e-commerce for buying and selling
goods and services which increased the sales and profit of seller.
e) Environmental impact
 The significant growth in e-commerce has a positive impact to the
environment compare to the traditional retailing. E-commerce reduces use
of natural resources and it does not pollute the environment as well.

Ecommerce location factors:

a) Importance of transport links
 Transportation plays a major role in e-commerce. As consumer perform
online orders, they wish to receive the product immediately in front in
their doorstep. In order to achieve this objective, organizations need to
have a good transport link.
b) No need for footfall
 Footfall which is also known as the measurement of the number of people
entering a shop or shopping mall. As ecommerce made buying and selling
online, there is no need for consumers to walk in to the stores.
Organisations can save the operational cost (example like rental) as there
is no need for them to have a store.
c) Need for space for increased inventory
 Increased numbers in online order/increase number of sales has made the
seller to have bigger warehouse space to store the products before deliver
them to consumers.
d) Availability of specialist labour.
 The availability of specialist labour such web designers, engineers,
computer support help the growth of e-commerce.