E-Commerce

What do you mean by E-commerce? E-commerce simply means buying and selling of goods and services across the Internet

Advantages and Disadvantages of E-Commerce 

The major advantage to a customer using this mode of shopping

are:

1.   One can buy/sell items from anywhere using one’s computer provided an internet connection is available.

 2.   The shopping can be done 24 hours a day, 365 days in a year

- an internet based shop never closes!

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3.   One can avail of services such as financial services, legal services, medical advice, etc. from appropriate portals.

4.   Wider variety of goods (particularly items like books and music) are accessible easily without spending time and money in physically visiting and searching in many shops.

5.   Anonymous friendly advice may be available on items one

may like to buy/rent.

The advantages which accrue to a business are:

1.   With a web-site a business can reach out to a worldwide customer base at a very low cost.

2.   Order processing cost is reduced as manual data entry is reduced.  Business is also carried out faster as all documents are exchanged electronically.

3.   Inventory size is reduced as transaction time is reduced.

4.   Funds transfer is faster.

5.  A large number of potential business partners can be quickly found and contacted using appropriate search engines and email correspondence.

6.  In some cases middlemen such as retailers can be eliminated as a manufacturer can reach out directly to a customer (Dell Computers in USA sells PCs directly to customers).   This reduces cost and delays.  This is an example of change in what is known as a supply-chain.

The major disadvantages of e-commerce are:

1.   Currently internet access is not widely available in India.

2.  Communication infrastructure is expensive and not very reliable particularly to individuals in India.

3.   Payment by credit card requires faith in the system security.

As of now there is no mutual trust between seller and buyer on

this system of payment using credit cards for goods and services

ordered via internet in India.  Customers are wary of giving their

credit card numbers to vendors who have only a ‘web presence’.

4.   Electronic data interchange standards have to be in place before Business to Business e-commerce can increase.   Small businesses may find it difficult to conform.

5.  Many persons go shopping for social contacts, touch and feel

before buying items. E-commerce will de-personalize transac-

tions.

6.   A major concern is security of transactions on the internet. Spies or hackers can steal and misuse credit card numbers if appropriate care is not taken.

7.   Shopping portals will be vulnerable to attacks by hackers unless special precautions are taken.   One type of nuisance is called denial of service in which a large number of frivolous enquiries are posted to a portal making it inaccessible to legitimate customers.

8.   Portals have to be protected from virus attacks and other electronic vandalism and espionage by special security systems.

9.  Customer’s privacy may be lost if regular log is kept of his/her buying habits.