Advantage of B2B e-commerce in business market

Internet is the prime medium for electronic commerce. Eventually, internet technologies have become an advantage for organizations and companies for further advancement and progression with their status in the business world. The amount of trade conducted electronically has grown extraordinary since the spread of the Internet. A wide variety of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail as well. A small percentage of electronic commerce is conducted entirely electronically for "virtual" items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is known as e-tail. Electronic commerce that is conducted between businesses is referred to as Business-to-business or B2B. B2B can be open to all interested parties (example is the commodity exchange) or limited to specific, pre-qualified participants (private electronic market). E-commerce or electronic commerce is generally considered to be the sales aspect of e-business.

A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web. Electronic commerce that is conducted between businesses is referred to as Business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market). Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions.Early development The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders or invoices electronically. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of electronic commerce. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing. The recent shake-out of the so-called "dot.com" companies, which have included the collapse of noted names such as eToys, boo.com and pets.com, have the experts re-evaluating their forecasts for e-commerce. But few can deny that the Internet revolution has led to a fundamental review of business planning strategies in corporate boardrooms around the world. It is now unthinkable for a major company not have its own website extolling its virtues and peddling its wares. Even for small companies, establishing an on-line presence has become a business necessity.

According to www.itu.int, “The frontiers of the Internet revolution do not stop at Silicon Valley. Take for example the Câmara dos Dirigentes Lojistas de Belo Horizonte (CDL/BH), an association of local retailers and exporters in the Brazilian city of Belo Horizonte, some 300 km inland from Rio de Janeiro. Originally set up in 1960 to share information among shopkeepers on credit purchases of customers, CDL/BH has now moved into the world of cyber-selling. Thanks to assistance provided through the International Telecommunication Union's Electronic Commerce for Developing Countries project (EC-DC), the association's 10 000 members have established a Business Exchange Service for business-to-business (B2B) transactions. Web purchasers can now click on the CDL/BH website to make electronic payments, access their commercial page listing of local businesses, learn about the association's services such as telemarketing, electronic transfer of funds, or even find out how to book space at the city's convention centre.” Despite CDL/BH's success in getting its members on-line, the rise of e-commerce, like the Internet itself, is still largely confined to the rich. In 1999, the United States accounted for more than 70 per cent of commercial websites around the world, with owners of those websites garnering over 90 per cent of global e-commerce revenues. In contrast, e-commerce revenues in Latin America and the Asia-Pacific region accounted for just over two per cent of the total in the same year. Internet and e-commerce businesses are in particular need of legal guidance with respect to intellectual property matters such as trademark and service mark registration and protection, copyright matters, software licensing, customer data ownership, the assignment of intellectual property rights from employees, and advertising, promotional, and media issues. The Firm’s extensive intellectual property practice helps internet and e-commerce companies to create and protect what is often their most valuable asset—intellectual property. One example of this disparity is in the Asia-Pacific region. The research firm eMarketer said in a recent study that, in the year 2000, the region's share of e-commerce jumped to 13.8 per cent of global on-line transactions. However, nearly 70 per cent of this commerce was centred in Japan. China and India, the world's two most populous nations, account for only a fraction of the region's total e-commerce. Even where e-commerce is picking up, the trade tends to be a North-South affair rather than between developing countries themselves. While eMarketer predicts that Latin American e-commerce will leap to USD 15 billion by 2003, it also noted that nearly 75 per cent of current on-line buying in the region is done through United States-based Internet sites. Part of the problem for businesses in the developing world is the cost of setting up an e-commerce platform on the Internet. ITU notes that the average cost for a company is around USD 250 000 while for major international firms the cost can run anywhere from USD500 000 to 2 million. Then there is the cost of Internet access. Internet service providers (ISP) in developing countries must cover both circuit and traffic costs to connect to a point of presence on the Internet backbone (usually in the United States), which makes the service more expensive for end-users. Users in the developing world must also contend with additional hurdles such as the high cost of Internet hardware/software, Internet access provision and telephone service charges, and the shortage of infrastructure, notably of telephone lines.

Eventually, internet technologies have been a great help for not only in large companies for also small developing enterprise.

References:

http://www.maryannetolentino.com/
http://www.itu.int/newsarchive/wtd/2001/FeatureE-commerce.html
http://www.weblaw.co.uk/
http://www.leclairryan.com/Internet--E-Commerce-Groups