Skip to main content

Traditional Commerce Versus E-Commerce

Table 1.1 shows the comparison between traditional commerce and e-commerce.

Table 1.1: Difference between Traditional Commerce and E-Commerce
 Traditional Commerce 
 E-Commerce 
 In traditional commerce, cost has to be incurred for the role of middlemen to sell the products. E-commerce is very cost effective. The total overhead cost required to run an e- business is comparatively less.
 It takes a lot of time to complete a transaction in traditional commerce. It saves a lot of valuable time for both the consumers and business firm.
 Customers themselves have to directly visit the business firm for the purchase of products. E-commerce provides convenience to both the customers and the business. Customers can browse through the respective website and order for the product, from anywhere in the world.
 It is not easy to expand business, since business organisations have to incur a lot of expenses to expand the business. In e-commerce, it is easy to expand the size of the market from regional international.
 It takes a lot of time and money to introduce a new product and analyse the response of the customers. It is easy to introduce a product on the web | site and get the immediate feedback of the customers.
 The cost incurred on the middlemen overhead, inventory and limited sales pulls down the profit of organisation. It helps to increase the sales of the organisation and also helps to enjoy greater profits by increasing sales, cutting cost and streamlining operating processes.
 Business is open only for a limited time. Round the clock 24x7 service is available in e-commerce.
 It is suitable for perishables and "touch and feel" items. It is not suitable for perishable goods and high valuable items such as jewellery, but suitable for purchasing tickets, books, music and software.
 In traditional commerce, the interaction between the business and the customer is "face-to-face". | In e-commerce, the interaction between the business and customer is "screen-to- face". Since there is no personal touch in e-business.
 There is manual processing of business transactions in traditional commerce. There are chances of clerical errors to occur. There is an automated processing of helps to minimise the clerical errors. business transactions in e-commerce. 1t
 The business relationship in traditional commerce is vertical or linear. In e-commerce the business relationship is characterised by end-to-end.



Labels:

Comments

Post a Comment

Popular Post

E-Procurement Cycle

Figure 2.6 illustrates the different steps associated with the overall procurement cycle, from the order placement to the accounts payable, in steps through a web based e-commerce network. It includes customers' inventory and supplier information and is readily accessible at any time and from everywhere.  E-procurement allows two-way communication of real-time financial and purchasing information. Management at both the buying and selling end can see what is happening at any given moment and identify trends and problems. A shorter purchasing cycle enables companies to maintain lower inventory levels and respond more quickly to stock-outs. Previous Next
2 comments
Read more

Business Strategy - Strategic Planning Cycle

E-business competitive strategy is normally formed and implemented according to a planning cycle which is called strategic planning cycle . There are four stages in this planning cycle as shown in figure 1.19: Industry and Competitive Analysis It aims to identifying those factors on which the success of an electronic commerce project or business would depend. One way of doing that is to carry out SWOT analysis and study your business as well as the business of competitors. Analysis of online competitor businesses is relatively easy since they are just a few clicks away on the web.  Strategy Formulation Based upen study of internal and external business environment and in light of a company's strengths and weaknesses, a competitive business strategy is formed. It may be a strategy of cost leadership, product differentiation or focus. One can also identify ways how information technology can be used to implement/enforce such strategy. The inputs to the strategy formulation process ar...
2 comments
Read more

Disadvantages of EDI

1), Operating Procedures : Since EDI is a structured way of working, companies usually change operating procedures.  2) Production and Purchasing Decisions : Responsibilities may have to be changed during the introduction of EDI system. Unless this system and the links with other systems are managed well, it is not possible for the data processing department to become involved in production and purchasing decisions.  3) Transparent : Less transparent than paper-based systems.  4) Flexibility : Certain EDI systems are highly flexible, others are very simple to implement.  5) High Costs : Applications are costing to develop and operate; especially new entrants find this more difficult to have EDI. Many small companies are facing resources problems in getting starter with the initial implementation of EDI system. It is beyond the resources these companies to invest tens or hundreds of thousands of dollars in setting and implementation costs, as well as weeks of personne...
Post a Comment
Read more