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Summary unoit 8
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Summary of 12 pages for the course Unit 8 - e-Commerce at PEARSON (fnb)
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P2 explain the impact of introducing an e-commercesystem to an organisation
Global market place: The global market place is required for e-commerce to work as
without its customers will not be able to purchase products online. The global market place
will grow when the volume of online purchases increases this also means then when there
are less online orders the global market place will decrease in size. One positive fact about
the global market place is that customers from all over the world will have access to the
product, also this will benefit the organisation providing the product as there is a chance
that their product can generate a lot of profit.
24/7 trading: 24/7 trading is when an e-commerce store is available all day every day. This
means that customers are able to purchase goods at any time of the day and night. One
positive fact about 24/7 trading is that people that work late are still able to purchase
products at a later time in the night. They may be busy with work so will not be able to
purchase products during the day. However, when an organisation uses 24/7 trading they
are able to purchases products whenever they want.
Low start-up cost: one positive about e-commerce is that the start up cost is very low, this is
because the organisation will not have to pay for bills, rent, insurance and many other
expenses that come with owning a building for business purposes. With e -commerce an
organisation does not have to pay for much they will only have to pay for a domain for the
website and maybe pay a third-party to build the website. The start-up cost of an e-
commerce businesses is much lower than that of a physical store, furthermore there is less
risk when starting an e-commerce business compared to a physical store business.
Competitive edge over those without an online presence: online businesses have a much
more competitive advantage than store only businesses this is due to the fact that online
businesses have access to more customers. More customers mean more sales which will
result in more profit. Also, this means that the online business will have more exposure
compered to the store only businesses. Another competitive advantage would be that
customers prefer to buy products online rather than instore due to many people being lazy
and not wanting to leave their homes. The online businesses allow these types of customers
to order products from the comfort of their homes.
Search facilities to find a specific product: with online business it is very easy to find specific
products, this is because most websites have a search tool that allows customers to easily
find a product that they want. They will just have to type the name of the product into the
tool, if the product is available it will come up on the user’s screen. This is an advantage for
organisations that use e-commerce as it allows customers to quickly find and purchase the
product that they want. This will also improve their customer service.
, consumer trust: one of the draw backs of e-commerce is trust. as transactions are done
online many customers payment details can be leaked this can be done by a hacker or
accidently by the business. this will reduce the trust between the customer and the
organisation. this is a draw back to e-commerce as when a customer bank details are leaked
there is a chance that there money could be stolen. another reason why consumer trust is
vital is because of scammers, as it is very easy to purchase products online without seeing
them some people get scammed into buying products that do not exist. for example a
customer will pay for a product and the product will never arrive to there door. this will
reduce consumers trust in e-commerce.
lack of human contact: having a lack of human contact is also a drawback to e-commerce as
some customers like to ask questions about a product before purchasing it. as with e-
commerce products are purchased online there is no human contact so customers are
unable to ask questions and get a response. this is a drawback because the customer may
have important question to ask. some people may say that customers can contact a
business through email however this will not be the same as face to face contact as asking
through email will be a long process for the customer as the business will take its time to
reply back to the customer.
delivery issues: delivery issues are also another drawback to e-commerce. this is because
customers have to wait to use a item that they have already paid for. this is a drawback
because with physical stores customers are able to use the product as soon as they have
paid for it. furthermore, some businesses decide to charge customers for delivery this is also
a draw back as something customers will order small products and the delivery fee will cost
more than the actual product. when items are being delivered to the customer they may get
lost in the process this is a drawback to the customer as they will have to wait a long time
before receiving their order. this will also reduce the trust between the business and
customer
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