 Main Activities of Electronic Commerce –

 Buying and Selling of Products- This activity involves providing product

information, price details on the Internet to enable a customer to buy a
product online
 Shipping of Products- The purchased products have to be delivered to the
respective customer
 Producing Financial statements – Business deals are settled electronically by
EDI and EFT. The Digitally signed documents are exchanged.

Four major sequential activities related to a prospective customer are:

1. Product
or Service 2. Price
search search
Main
activities
4. 3. Actual
Payments purchase
• E-commerce is definitely, one of the business options
that one will have to explore today.
• E-commerce can be broadly defined as ‘ any form of
business transaction in which the parties interact
electronically rather than by physical exchanges of
documents or direct meetings amongst officials’.
• E-commerce can be described as buying and selling of
goods and services over Internet.
 Broad Goals of Electronic Commerce –
 Reduced costs
 Lower product cycle time
 Faster customer response
 Improved service quality
• E-commerce is a new way of conducting, managing and executing business
transactions using computers and telecommunication networks. It is expected
to improve the productivity and competitiveness of paticipating businesses,
by providing access to an online global market place with millions of
customers and thousands of product and services.
 Technical components –
 Client or PC workstation
 Transaction Server
 Database Server
 Database Transaction
 Internet communication line / modem
 ISP
 Router
 Pre-requisites of Electronic commerce – very few requirements are needed to
conduct e-commerce business such as:
 A website, may be your own or one supplied to you by a cart provider.
 A shopping cart program to list your products or services and a means to
collect purchase information
 A method to get the funds into your bank account
If the process is to be automated, a compatible credit and merchant account and
a transaction processor (eg. Authorise-net) to collect credit card information
and to obtain authorisation are needed.
 Functions of Electronic commerce –
 Communication – This function is aimed at the delivery of information and
/or
documents to facilitate business transactions. E-mail is an excellent example
of this.
 Process Management – This function covers the automation and
improvements of business processes. The best example of this would be
networking two computers together so that they can share and transfer data
rather than have a person to take data from one computer to another.
 Service Management – this function is the application of technology to
improve the quality of service. A good example of this function is the Federal
Express website. It permits customers to track shipments and the schedule
pickups 24 hours a day with a worldwide network without having to talk to a
service representative. Customer service is greatly enhanced due to the sites
capabilities.
 Transaction capabilities – this provides the ability to buy or sell on the
internet or some other online service. The retail websites of Amazon.com
offer good examples of transaction capabilities of e-commerce.
Co-operating businesses connected using their own
private telecommunication network carrying out
transactions in a semi-automated way.
Railways, airlines, ticket booking online and payment
through credit cards or e-cash.
Filing tax returns to the government and obtain an
immediate acknowledgement on real time.
Web based educational material allowing the
students to learn any time and at any place.
Online training of employees
Distances do not matter in carrying out trade; you can reach the world at
any time. This helps companies to have a cheap and effective way of
communication with suppliers on one side and customers on the other
side.
An online store works 24/7
Compared with a retail outlet or new office, cost of setting up an e-
commerce website is very low.
More flexibility in website to add and remove a product or products than in
catalogues or brochures.
Being online, it potentially gives exposure to previously untapped market
segment
Error reduction as orders do not have to be re-keyed in order entry system.
Wider choice of product and brand
Inventory size is reduced
Funds transfer is fast
Large number of potential business partners can be quickly found and
contacted
Online stores do not exist for long. Many companies
do not know exactly how to set up a store,
resulting in a large group of annoyed and
dissatisfied customers
Computer systems will never be 100% safe. Hackers
intercept transactions
Rural Area cannot be reached.
As of today, e-commerce poses problems to sell
products to a target group other than young,
highly educated people.
• Electronic commerce and Electronic Business
The business models included are:
B2B, B2C, C2C, C2B, B2E, B2G, G2C, G2B, G2G, B2A