Provide an Assessment of the opportunities and challenges afforded by
e-business
from a business perspective
_________________________________________________________________
Provide an Assessment of the opportunities and challenges afforded by e-business from a business perspective
E-business
and associated technologies continue to have a major impact on the way organisations
conduct business. The Internet and new technologies have transformed commerce
and allow traders and consumers to transact irrespective of time, place and
device. This new commerce also presents new challenges, because traders now
need another set of expertise and tools, and often opt for partner solutions
such as online marketplaces.
The eBay
marketplace is an example of how the internet and technology lower trade costs for
merchants of all sizes, by enabling them to connect, find a match, establish
trust, transact and pay. We can see how these lower trade costs also lead to
traders expanding their operations to foreign countries. European Union cross-border
trade via the eBay marketplace has grown six times faster than offline
cross-border trade for the period 2004 to 2010. Moreover, lower trade costs
translate to consumer welfare gains.
The lower
online trade costs stem from, amongst other things, the way in which the Internet
and technology can help establish trust between trading partners and between buyers
and sellers. This is done by facilitating communication throughout the
transaction process and providing transparent, interactive ways of displaying and
sharing information between parties.
The mobile
device is fast becoming perhaps the most important channel empowering both
merchants and consumers. Retailers whether large or small need to embrace this
evolution in order to stay relevant in today’s commerce landscape. We also see
the emergence of a consumer, using his or her mobile phone to
research and purchase products, as well as to receive advertising and
promotional messages.
The uptake
of mobile technologies is causing a change in the dynamics of commerce. There is
a shift away from the traditional retail store and towards the consumer who is
empowered by their smart phone and who can purchase items any place, anywhere
and at any time.
The adoption
of e-business can be considered from two different perspectives, namely the
threat perspective and the opportunity perspective. The opportunity refers to
the situation of adopting new business initiatives such as internet
technologies, making it possible to achieve advancement to overall business.
Business threat refers to how businesses or new market’s entrants will
ultimately fail if they do not go for e-business competitively. They will have
to invest in e-usiness to offer services to customers who have come to expect
from them.
The
exponential growth and rapid changes of e-business technologies bring both new
opportunities and challenges to businesses. The market has forced companies to
focus once again, on the basics of cost, quality and profitability. This
presents unique challenges (and opportunities) with conducting commerce via the
Internet. The business model should
enable the cost, quality and profitability necessities, while utilising a
long-term profit-based business plan, and simultaneously accommodating the
unique business issues associated with e-commerce.
________________________________________________________________