E-COMMERCE

Business Organizations and the Impact of E-Commerce



Business Organizations and the Impact of e-Commerce

Introduction

E-commerce is the activity or process of business through the Internet which includes not the only transaction of goods or information but also includes the collaboration of inter-electronic, e-integration and e-service. It includes different electronic-activities of business such as: trade with another organization, the internal process of a company that use to support buying and selling processes, planning and other activities. Indeed, it is the area of business and technology that remains comparatively new although business emerges and constantly changes its area. Using E-commerce, thousand of transactions can be made in a single click within a second between buyer and seller. Rayport and Jaworski (2003) argue about E-commerce as a technological-mediator between two sides (for example: customers and organizations) and this commerce are also based on inter-organizational performance where such exchanges are facilitated through electronically (Reynolds, 2004).

On the other side, Internet-marketing is part of E-commerce and often used together in the business. It is the process between two parties as for example: buyer and seller, to make electronic transaction on the Internet. In Internet-marketing, activities are taking place as Communicating, Content providing and Network function offering. Finally, products or services are sold through these activities (Korper, 1999).

Understand the structure and aims of business organizations

1.1: assess an organization's core business functions

There are five core functions that all your business activities should perform:

Increase revenue - more money coming in

This is the "top line"

Reduce expenses - less money going out

For every dollar you reduce expenses, you would need to increase revenue by a factor of x(where x is equal to (revenue/net profit)) to have the same positive effect.

Example: if your net profit margin is 10% you would have to increase revenue by $100 to have the same effect on the bottom line as cutting expenses by $10

Increase your customer base - more sources of money coming in

diversify your sources of revenue

Increase the long-term value of each customer - more money from each customer

Sell more stuff to each customer

Unless you just haven't been paying attention, you already know that selling more to existing customers is considerably cheaper than acquiring new customers

Increase shareholder value - making your business produce greater income increases its total value to you, the shareholder this is "the bottom line"

1.2: Evaluate an Organization's Business Aims and show how they Relate to Stakeholders

An aim is where the business wants to go in the future, its goals. It is a statement of purpose, e.g. we want to grow the business into Europe. Business objectives are the stated, measurable targets of how to achieve business aims. For instance, we want to achieve sales of 10 million in European markets in 2004. A mission statement sets out the business vision and values that enables employees, managers, customers and even suppliers to understand the underlying basis for the actions of the business.

Business Objectives

Objectives give the business a clearly defined target. Plans can then be made to achieve these ...