Chapter 5 Business-to-Business Strategies: From Electronic Data Interchange to Electronic Commerce

Sales Cost of goods sold Gross margin Expenses Net income

Supply Chain Management

Using Internet Technology in the Supply Chain

Increasing Efficiency in the Supply Chain Technology in the Supply Chain Increasing Efficiency in the Supply Chain Building and Maintaining Trust in the Supply Chain

Purchasing, Logistics, and Support Activities potential for cost reduction & business process improvement in purchasing, logistics, and support activities.

Purchasing Activities

Businesses make a distinction between direct and indirect materials. Direct materials are those materials that become part of the finished product. Indirect materials are all other materials that the company purchases.

Logistic Activities The classic objective of logistics is to provide the right goods in the right quantities in the right place at the right time.

How can the internet and web improve logistics management Increase alternatives for receiving, warehousing, controlling inventory,& delivery schedules Lower transaction costs Provide constant connectivity between firms engaged in logistic management Delivery of real time shipping info Allowing customers to track info

Support Activities

Training and Knowledge Management One common activity that underlies multiple primary activities is training. Knowledge management is another support activity that intentionally collects, classifies, and disseminates information about a company, its products, and its processes.

Network Model of Economic Organization

E-Government Although governments do not typically sell products or services to customers, they do perform many functions for their stakeholders. Governments also perform business-like activities; for example, they employ people, buy supplies from vendors, and distribute benefit payments of many kinds.

Evolution of e-commerce mechanisms EDI/ERP Sell side Storefront Buy side e-procurement B2B Marketplace

Electronic Data Interchange (EDI) EDI is a computer-to-computer transfer of business information between two businesses that uses a standard format. trading partners. EDI-compatible.

Value-Added Networks EDI reduces paper flow and streamlines the interchange of information among departments within a company and between companies. Trading partners can implement the EDI network and EDI translation processes in several ways use either direct connection or indirect connection.

Direct Connection Between Trading Partners

Indirect Connection Between Trading Partners

Electronic Marketplaces and Portals

Is your business suited to an e-marketplace? Who is your target customer? Where are your target customers located? Do your customers buy online? Is your business in an expansion mode? Can your team support e-marketplace efforts? Will e-marketplaces conflict with any other distribution channels?

Industry Marketplaces

Marketplaces