A Project On E-Business

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Sr. No. Topic 1 Introduction to E-Business 2 E-Business in India 3 Barriers affecting growth of EBusiness 4 E-Business Life Cycle 5 Advantages of E-Business 6 Disadvantages of E-Business 7 Conclusion

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Introduction to E-Business:The Internet has created a new economic ecosystem, the ecommerce marketplace, and it has become the virtual main street of the world. Providing a quick and convenient way of exchanging goods and services both regionally and globally, e-commerce has boomed. Today, e-commerce has grown into a huge industry with US online retail generating $175B in revenues in 2007, with consumer-driven (B2C) online transactions impacting industries from travel services to consumer electronics, from books and media distribution to sports & fitness. With more than 70% of Americans using the Internet on a daily basis for private and/or business use and the rest of the world also beginning to catch on, e-commerce's global growth curve is not likely to taper off anytime soon. However, the US recession has taken its toll on online sales. Although early 2008 estimates by Forrester Research were very strong with 2008 revenues upwards of $204B (a 17% growth rate), 2008 holiday sales showed the first decrease in the last 7 years. Research by ComScore shows sales declining by 1% for the first 49 days of the holiday season. Both e-business and e-commerce rely on the Internet to accomplish their goals. E Business includes buying and selling of products and services, servicing customers, collaborating with business partners, and conduction other intra-business tasks. Successful E-Business depends on a critical threshold of online user, the precursor to a critical threshold of sellers & buyers. E-Business is a broader aspect with e-commerce, Internet, marketing, e-procurement etc. E-Commerce refers to online transaction buying and selling of goods and services over the Internet involving transaction of monetary nature. E-Business applications strive to give a good idea of their company, promoting the values they use to market their business, whereas e-commerce is a subset of e-business. Transactions involving money are e Commerce activities including the interactions with business partners, customers, vendors.

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In the last decade, many startup e-commerce companies have rapidly stolen market share from traditional retailers and service providers, pressuring these established traditional players to deploy their own commerce websites or to alter company strategy in retaliation. This effect is most pronounced in travel services and consumer electronics. According to comScore, online leisure travel bookings reached about $51B in 2005, or 44% of all online sales, which were around $122B in the same year. Roughly 30% of all travel bookings currently occur online. Consumer electronics, which includes the purchase of digital cameras, mobile phones, and home PC's, accounted for nearly $26B of worldwide e-commerce sales occurring in 2006, according to the NPD Group. As traditional brick and mortar firms continue to lose market share to e-commerce players, they will likely see continued declines in their revenues, operating margins, and profits. It is important to note that most e-commerce players are at a competitive advantage to retailers. They have lower operating expenses and better inventory management due to operating in a virtual commerce environment. For
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example,Amazon.com (AMZN) has revenue per employee of nearly $850k while its retail counterpart, Best Buy (BBY), generates revenue per employee of only $270k. Clearly, e-commerce vendors will have the most to gain if they successfully disrupt retail customer acquisition, disintermediate distributors/resellers, and under-price retail establishments. As a consequence of e-commerce vendor gains, financial transaction processors and parcel shipping companies are among ancillary vendors who will gain.

E-Business in India:E-Business has tasted much success in India in recent past and has provided Indian business a new heights, global reach, competitive advantage, acquiring new customers (global & local), foreign product knowledge, etc. E-Business has become integral part of everyday life from online banking to brokerage transactions, e-contracts to global marketing. E-Business has seen significance impact on airline sector, banking sector, educational, matrimonial services, placement sites and many B2B transactions

Growing Sectors of E-Business in India:

Automobiles: Buying and selling of new & used four wheeler and two-wheelers, its marketing, etc. Real estate and e-commerce: They provide information on new properties as well as properties for resale. Travel & Tourism: Online reservations, tour packages, hotel bookings. Stocks & Shares: Online trading, online banking. Gifts through E-Commerce: Chocolates, Luxury items, flowers. Matrimonial Services, Employment sites Indian railway(IRTC)

Barriers Affecting the Growth of E-Business:6 | Page

1. Information Technology & Security factors:Major hurdle for growth of a e-business all over world is the security of online data. Ensuring security of payments and privacy of online transaction is key to widespread acceptance of e-commerce. Virus, spyware, worms, Phishing increases fear of attacks & spoofing. Lack of transparency in electronic transactions. Internet provides greater access to data not only to legitimate users, but also hackers, disgruntled employees, corporate spies.
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Customer Perception and attitude: Lack of trust among customers for online business. Not sure of product quality No touch & feel of product. Many Indians prefer to physically go out for shopping. Indian customers has attitude to bargain products. Impatience to wait for receiving the purchased product its one thing to submit a credit card number to buy a product. Its quite another thing to put your entire personnel dossier online and hope that no one intercepts it. Allan & William.

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Technological Factors:

E-Business partners find it hard to invest & update with new technologies. Bandwidth: Transmission capacity of a communication channel is a major barrier for products that require more graphical & video data. Rapidly changing technologies & emerging of new technologies.
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Financial costs: Storing information, data mining, processing orders has impact. High costs of developing, purchasing new software, licensing of software, integration into existing systems, costly ebusiness solutions for optimization.

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General Factors:

Lack of awareness & understanding the value of e-business & security involved in it. Lack of understanding on how e-business operation works. Lack of trust: Safety, security, delivery. Need for insurance of high cost products Shipping & courier costs Lack of IT knowledge to purchase online. Different local languages & culture factors. Leaders of many SMEs have less literacy in computers & IT area.

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Internet factor:

According to internetworldstats.com, India with a population of over 1.1 billion has estimated 6.9% (81 million) Internet users by 2008. E-business depends on speed, bandwidth of communication. Internet connections yet to reach many rural areas. Broadband connections are limited to urban & sub-urban areas. Low internet penetration as well as low credit card population.

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Infrastructural & Internet resisting Factors:

Logistics: Deliver the product, safe and secure, in the hands of the right guy in right time frame. Need to share your revenue here (~4% or more) even when yourget paid by net banking. Underdeveloped transportation infrastructure resulting in slow and uncertain delivery of goods and services. Bureaucratic wrangles: Fear among elderly staff is significant barrier to e-transformation of organization. Survey by the GIIC found out that only 20% of organization covered under CIO segment are trying to use E-Business to an extent.

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Political & Legal factors:

Taxations: Octroi, entry tax, VAT and lots of state specific forms which accompany are confusing at times. Lack of regional legel framework, and legal framework on esignatures. Need of harmonized taxation laws. Rights to e-consumers still a major issue. Domain name registration policy, domain name disputes, privacy & data protection issues.

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User Interface factors:

Some products require more graphics than textual data. Some websites GUI confusing at times. Limited menus, poorly designed navigations, difficulty in comparing multiple products on same screen.
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Lack of online support with product selection. Room for improvements in sound and picture quality. Virtual immaturity: This area in which much progress has not taken place. Web page design can change customer preferences.

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E-Business Life Cycle:1. Business Establishment:

E-Commerce Strategy: The first and most important component when considering moving your business online is to build an ecommerce strategy. The strategy is developed to include:

Mission and Aims Business Objectives Business Alignment Tactical Deployment Marketing Requirements and Goals Content Gathering and Management Fullfillment and Logistics Financial Management and Payments Social Media Platform and Technology Maintenance and Management Review and Recycle

Business Deployment:- Create new and exciting business opportunities by delivering the best of breed technology and services. The role is to guide and support the requirements of the customers. It can become part of your organisation leading the deployment process and providing secure services

When deploying an eCommerce system issues related to payment solutions and logistics are very important and can be the difference between success and failure. Next step is to make sure that your critical company information assets are secure and managed. This may men that you need to provide real time integration to your Enterprise Resource Planning (ERP) system
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like SAP Business One. That requires use of advanced services like web services and SOAP.

2. Design and Develop:

Not every solution to business problems comes out-of-the-box. So care must be taken to understand what can be done by existing technology and what we may have to create over and above these capabilities. Take care of the customers unique requirements and develop a solution that works for the best possible Return on Investment. How you develop is very important. The platform that is chosen is only the starting point. If development is not done in an integrated fashion then future upgrades may not be possible. The acceditation of the development organisation is very important. Part of design and development is testing. The use of regression testing methods greatly improves the success of any development project.

3. Site Implementation and Security:

Above all else we believe that security is a mandatory requirement in everything we do. So follow the best practice rules when implementing our customers requirements. When dealing with eCommerce systems be aware of the Provider Card Industry Data Security Standards (PCI DSS) these requirements impact on all levels of development, deployment and implementation. It is essential that your hosting provider be aware and capable of hosting PCI compliant systems.

4. Secure Managed Hosting:

It needs to ensure that one provides the very best capabilities when it comes to providing platforms for our customers business. Work only with fully accredited providers who deliver secure and managed capabilities. When it comes to the hosting infrastructure starts with the hardware
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providers such as CISCO, HP, SUN and also the data centre facilities. The data center need to have fully redundant capabilities for data and power as your eCommerce solution will be running 24/7 for your business.

5. Management and Maintenance:

Each customer solution we deliver has a lifecycle that enhances the return on our customers investment. We provide solutions that are scalable, supportable, have a future technology roadmap and provide secure capabilities. Many companies offer eCommerce and eBusiness solution.

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Advantages of E-Business:1. Overcome Geographical Limitations If you have a physical store, you are limited by the geographical area that you can service. With an ecommerce website, the whole world is your playground. Additionally, the advent of mcommerce, i.e., ecommerce on mobile devices, has dissolved every remaining limitation of geography. 2. Gain New Customers With Search Engine Visibility Physical retail is driven by branding and relationships. In addition to these two drivers, online retail is also driven by traffic from search engines. It is not unusual for customers to follow a link in search engine results, and land up on an ecommerce website that they have never heard of. This additional source of traffic can be the tipping point for some ecommerce businesses. 3. Lower Costs One of the most tangible positives of ecommerce is the lowered cost. A part of these lowered costs could be passed on to customers in the form of discounted prices. Here are some of the ways that costs can be reduced with ecommerce:

Advertising and Marketing:Organic search engine traffic, pay-per-click, and social media traffic are some of the advertising channels that can be cost-effective. Personnel The automation of checkout, billing, payments, inventory management, and other operational processes, lowers the number of employees required to run an ecommerce setup. Real Estate This one is a no-brainer. An ecommerce merchant does not
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need a prominent physical location. 4. Locate the Product Quicker It is no longer about pushing a shopping cart to the correct aisle, or scouting for the desired product. On an ecommerce website, customers can click through intuitive navigation or use a search box to immediately narrow down their product search. Some websites remember customer preferences and shopping lists to facilitate repeat purchase. 5. Eliminate Travel Time and Cost It is not unusual for customers to travel long distances to reach their preferred physical store. Ecommerce allows them to visit the same store virtually, with a few mouse clicks. 6. Provide Comparison Shopping Ecommerce facilitates comparison shopping. There are several online services that allow customers to browse multiple ecommerce merchants and find the best prices. 7. Enable Deals, Bargains, Coupons, and Group Buying Though there are physical equivalents to deals, bargains, coupons, and group buying, online shopping makes it much more convenient. For instance if a customer has a deep discount coupon for turkey at one physical store and toilet paper at another, she may find it infeasible to avail of both discounts. But the customer could do that online with a few mouse-clicks. 8. Provide Abundant Information There are limitations to the amount of information that can be displayed in a physical store. It is difficult to equip employees to respond to customers who require information across product lines. Ecommerce websites can make additional information easily available to customers. Most of this information is provided by vendors, and does not cost anything to create or maintain.

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9. Create Targeted Communication Using the information that a customer provides in the registration form, and by placing cookies on the customer's computer, an ecommerce merchant can access a lot of information about its customers. This, in turn, can be used to communicate relevant messages. An example: If you are searching for a certain product on Amazon.com, you will automatically be shown listings of other similar products. In addition, Amazon.com may also email you about related products. 10. Remain Open All the Time Store timings are now 24/7/365. Ecommerce websites can run all the time. From the merchant's point of view, this increases the number of orders they receive. From the customer's point of view, an "always open" store is more convenient. 11. Create Markets for Niche Products Buyers and sellers of niche products can find it difficult to locate each other in the physical world. Online, it is only a matter of the customer searching for the product in a search engine. One example could be purchase of obsolete parts. Instead of trashing older equipment for lack of spares, today we can locate parts online with great ease.

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Disadvantages:1. Ecommerce Lacks That Personal Touch Not that all physical retailers have a personal approach, but I do know of several retailers who value human relationship. As a result, shopping at those retail outlets is reassuring and refreshing. Clicking on "Buy Now," and piling up products in virtual shopping carts, is just not the same for me. Different people sing to different tunes. For me, the demise of the personal touch in online transactions is the biggest disadvantage of ecommerce . 2. Ecommerce Delays Goods Unless you are using a website to merely order a pizza online, ecommerce websites deliver take a lot longer to get the goods into your hands. Even with express shipping, the earliest you get goods is "tomorrow." But if you want to buy a pen because you need to write something right now, you cannot buy it off an ecommerce website. Likewise with candy that you want to eat now, a book that you want to read tonight, a birthday gift that you need this evening... You get the idea. An exception to this rule is in the case of digital goods, e.g. an ebook or a music file. In this case, ecommerce might actually be faster than purchasing goods from a physical store. 3. Many Goods Cannot Be Purchased Online Despite its many conveniences, there are goods that you cannot buy online. Most of these would be in the categories of "perishable" or "odd-sized." Think about it, you cannot order a popsicle (also referred
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to as an ice pop or ice lolly) or a dining table set. Well, you could order both of them online, but consider the inconvenience. The popsicle would have to be transported in refrigerated trucks. Unless the seller was willing to make a huge loss, the cost of shipping that popsicle would far exceed the cost of the popsicle. Likewise, a dining table set can certainly be purchased online. In some cases, the cost of logistics is bearable. But if you have to return the furniture, you will get well-acquainted with the inconvenience of ecommerce. Ecommerce Does Not Allow You to Experience the Product Before Purchase. You cannot touch the fabric of the garment you want to buy. You cannot check how the shoe feels on your feet. You cannot "test" the perfume that you want to buy. You get the idea. In many cases, customers want to experience the product before purchase. Ecommerce does not allow that. If you buy a music system, you cannot play it online to check if it sounds right? If you are purchasing a home-theatre system, you would much rather sit in the "experience center" that several retail stores set up. 4. Anyone Can Set Up an Ecommerce Website We live in an era where online storefront providers bring you the ability to set up an ecommerce store within minutes. I have tried it, and it is possible to set up a basic store in under 10 minutes. But if anybody can set up a store, how do I know that the store I am purchasing from is genuine? The lowered barriers to entry might be a great attraction to the aspiring ecommerce entrepreneur. But for the buyer, reliability can be an issue. This could lead customers to restrict their online purchases to famous ecommerce websites. 5. Security
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When making an online purchase, you have to provide at least your credit card information and mailing address. In many cases, ecommerce websites are able to harvest other information about your online behavior and preferences. This could lead to credit card fraud, or worse, identity theft.

Conclusion:While we might be gung-ho about ecommerce, we must acknowledge that there are disadvantages too. Only when we accept our shortcomings will we work towards overcoming them.

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