The word e-commerce can be expanded as electronic commerce and refers to the marketplace where the transactions take place electronically. In the e-commerce platform, goods and services are bought and sold over the internet.
The transactions that take place can be broadly divided into 4 types :
- Business to Business
- Customer to Customer
- Business to Customer
- Customer to Business
Advantages of transacting in the e commerce platform:
- The price paid by the buyer is less as the transactions are made electronically
- The margin of the seller increases as the existence of the dealers, wholesalers are eliminated
- It is faster and safer.
- Both the buyer and the seller carry out the transactions at the convenience of their time and place
- The buyer can compare the various options very easily
- The seller do not need any prime location to set up a Shop or office space for selling online
- Less staff required compared to physical stores
Limitations of transacting in the e commerce platform:
- The quality and the feel of the product cannot be ascertained beforehand
- The payment mechanism may not be secure
- The seller needs to incur a lot of expenditure in acquiring a website which can allow a lot of users to access the website at the same time.
- There is limited scope for building on a relationship between the buyer and the seller.
