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Competitive Advantage Using E-Commerce

E-commerce represents a relatively new method of conducting business transactions. In addition to buying and selling or exchanging products it also facilitates the provision of services and information usually through communication networks such as the internet, intranet and extranet. The key drivers of e-commerce are that it has the potential to: 
  1. Provide a range and quality of service, meeting customer demands, assist in retaining customers and gaining competitive advantage by maximising revenue. 
  2. Improving the effectiveness of supply chains that is cost reduction. 
  3. Improving knowledge management cost reduction and differentiation and focus.

The main potential benefits of competitive advantages are as following: 
  1. To expand the marketplace to national and international – in fact to remove borders. 
  2. To decrease the cost of creating, distributing, storing and retrieving paper based information.
  3. Allowing the reduction of inventory and 'pull' supply chain management. 
  4. Enabling customisation of products and services. 
  5. Reducing time between payment and delivery and other administrative 'drag'. 
  6. Improve image, service, and access to information. 
  7. Increase productivity, flexibility and reduce transport costs.

The perceived benefits for the customer are: 
  1. Improvements to service. 
  2. Personal communications, speed (and accuracy), enhanced tracking, and (potentially) 24-hour communications. 
  3. Reductions in price. 
  4. Better information facilitating better feedback on quality. 
  5. Reduction in fulfilment time. 
  6. Flexibility of offerings allowing better fit to their needs. 
  7. Access to a global marketplace.

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