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Introduction to E-Commerce
When people
talk about electronic commerce (e-commerce or EC), most
will think of it as using the Internet to help the
business market and sell its products and/or services. But
in reality, e-commerce is much more than that. Generally,
there are 2 kinds of e-commerce; business-to-business and
business-to-consumer. Here, we shall look at how a
business may fit into either one kind of e-commerce.
Business-to-Business E-Commerce
The business-to-business kind of e-commerce refers to a
company selling or buying from other companies. In our
context here, the company communicates with the other
companies by electronic means. This is actually not new,
as many businesses have already been doing it since the
80’s by means of Electronic Data Interchange (EDI).
EDI -
The original method
Since the '80s, organisations have been using EDI to
conduct business transactions electronically. Some of
these transactions include sending/receiving of orders,
invoices and shipping notices. EDI is a method of
extending the organisation's computing power beyond its
boundaries. But the high cost and maintenance of the
networks made this method out-of-reach for small and
medium sized businesses. In addition, the system is
somewhat inflexible, as connecting a new vendor to the
network would involve huge costs and restructuring.
The
Internet - The new wave
With the introduction of the Internet, companies,
regardless of size, can communicate with each other
electronically and cheaply. Companies that do so use it in
several ways, depending on whether they are a manufacturer
or supplier, although this can be confusing sometimes, as
a manufacturer can also be a supplier.
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