BUSINESS TO BUSINESS

Types of E-commerce Classified by nature of market relationship Business-to-Consumer (B2C) Business-to-Business (B2B) Consumer-to-Consumer (C2C) Classified by type of technology used Peer-to-Peer (P2P) Mobile commerce (M-commerce)

Major Types of E-commerce

Business-to-Business (B2B) E-commerce B2B is that model of e-commerce whereby a company conducts its trading and other commercial activity through the Internet and the customer is another business itself. It is the largest form of ecommerce In this form the buyers and sellers are both business entities and do not involve an individual consumer. It is commonly known as EDI (Electronic Data Interchange).

Business-to-Business (B2B) e-commerce (cont…)‏ The companies included in the B2B ecommerce are manufacturers, wholesalers rather than retailers only. Pricing is based on quantity of orders and is often negotiable. This type of ecommerce is privately held, since only business companies can qualify as potential buyers.

Advantages of B2B e-commerce Direct interaction with customers Focused on sales promotion Building customer loyalty Scalability-This means that the web is open and offers round-the clock access. Thus the company is able to handle many more customers on a much wider geographical spread. Savings in distribution costs

Concepts, Characteristics, and Models of B2B EC ‏ B2B EC Characteristics Parties to the transaction Online intermediary—an online third-party that brokers a transaction between a buyer and a seller; can be virtual or click-and-mortar; buyers; sellers Types of transactions Spot buying—the purchase of goods and services as they are needed, usually at prevailing market prices Strategic sourcing—purchases involving long-term contracts that are usually based on private negotiations between sellers and buyers

Concepts, Characteristics, and Models of B2B EC (cont.)‏ Types of materials Direct materials—materials used in the production of a product (e.g., steel in a car or paper in a book)‏ Indirect materials—materials used to support production (e.g., office supplies or light bulbs)‏ MROs (maintenance, repairs, and operations)—indirect materials used in activities that support production

Concepts, Characteristics, and Models of B2B EC (cont.)‏ Direction of trade Vertical marketplaces—markets that deal with one industry or industry segment (e.g., steel, chemicals). Horizontal marketplaces—markets that concentrate on a service or a product that is used in all types of industries (e.g., office supplies, PCs)‏

Concepts, Characteristics, and Models of B2B EC The Basic B2B Transaction Types Sell side—one seller to many buyers Buy side—one buyer from many sellers Exchanges—many sellers to many buyers Collaborative commerce—communication and sharing of information, design, and planning among business partners

Types of B2B E-Commerce

Concepts, Characteristics, and Models of B2B EC ‏ Supply chain relationships in B2B Interrelated sub processes and roles B2B applications offer competitive advantages for supply chain management (SCM)‏ Virtual service industries in B2B Travel and tourism services Real estate Online stock trading Electronic payments Online financing

Concepts, Characteristics, and Models of B2B EC ‏ Benefits of B2B Eliminates paper and reduces administrative costs Expedites cycle time Lowers search costs and time for buyers Increases productivity of employees dealing with buying and/or selling Reduces errors and/or improves quality of services Reduces inventory levels and costs Increases production flexibility, permitting just-in-time delivery Facilitates mass customization Increases opportunities for collaboration

Websites that are engaged in B2B ecommerce commodityindia.com Indiaconstruction.com clickforsteel.com etc.

Consumer-to-Consumer (C2C) E-commerce It facilitates the online transaction of goods or services between two peoples. However, there is not visible intermediary involved, but the parties cannot carry out the transactions without the platform, which is provided by the online market such as eBay. Examples: Advertisement of personal services over the internet. Selling of knowledge and experts online.

C2C e-commerce (cont…)‏ In the C2C e-commerce, the consumer lists items for sale with commercial auction site. The participants in C2C ecommerce are unknown, not trusted parties to sell goods and services to another one. Example of C2C ecommerce web is eBay, where consumers sell their goods and services to other consumers; And PayPal (instead of purchasing goods and services directly from the unknown, entrusted seller, the buyer can send money to the PayPal. Then the PayPal notifies the seller that they will hold the money for them until the goods have been shipped and accepted by the buyer).

Websites engaged in C2C ebay.com ICQ.com MSN.com bidorbuy.com

P2P P2P peer to peer technology enables internet users to share files and computer resources directly without having to go through a central web server. Napster.com which was established to aid Internet users in finding and sharing online music files known as MP3 files is perhaps the most well known example of peer to peer e-commerce.

M-Commerce Mobile commerce refers to the use of wireless digital devices to enable transactions on the web. They utilize wireless networks to connect cell phones and handheld devices such as: Cellular phones Hand-held computers such as palmtops, tablets PCs Messaging/pager devices Personal digital assistants (PDAs)