1. Unit 1: Business Skills for e-commerce
A3: Design an e-commerce solution

2. Criteria
2 tasks
5 Passes
3 merits
3 distinctions

3. Task 1: (LO3 AC 3.1, 3.2, M1, M3, D1, )
Produce a report (600 words) based on market research covering the following:
Physical stores selling wooden phones cases in the UK
Online stores (or physical/online hybrids) selling wooden phone cases in the UK
International online stores selling wooden phone case
The price, brand, quality, features and value of their offerings
The competition they would offer to MWS
An analysis (illustrated) of the key ecommerce features offered by the competition
A conclusion about the type of ecommerce solution MWS should offer

4. Task 2: (LO3 AC 3.3, 3.4, 3.5, M2, D2, D3)
Produce a design specification (600 words) for an MWS ecommerce solution covering the following
a financially justified choice of hosted or in house web services
a financially justified choice of payment systems
the ecommerce features required and why they have been selected
the security features that are required in the solution
the legal requirements that must be met
an evaluation of the suitability of the proposed design in comparison with the competition

5. Financial justification
Couriers or own transport?

6. Transport MWS will need to deliver the goods!
There are various possibilities:
Royal Mail
Private couriers
Own transport

7. Assumptions Number of sales per day? (=No of deliveries)
Number of different destinations
Location of furthest destination
Number of vehicles required
Miles covered
Driver hours worked

8. Assumptions Number of sales per day? (=No of deliveries) say 20
Number of different destinations say 20
Location of furthest destination 620 miles (HR1 4QL to John O’Groats, RAC Route planner, note this would be at least three working days – see driver’s hours regulations – would incur stop-over charges for driver.)
Number of vehicles required say 4
No of drivers say 4
Miles covered say 8hours driving – 2 hours rest/delivery = 6 hrs/day at 60mph(?)= 360 miles/driver/day * Need to reference drivers hours regulations – may need an extra driver to cover this
Driver hours worked (No more than 10 hours/day)

9. More assumptions/research
Cost of vehicles
Cost of drivers
Royal mail charges
Courier charges
Cost of journeys for own vehicles (eg diesel/petrol cost)

10. More assumptions/research
Cost of vehicles, Ford Transit Connect New £11060, Jennings Motor Group, 10/02/16
What if the vehicle was leased? More research… £142 pm vanarama 10/02/16
Cost of drivers, £12.42/hr temporary staff Morgan Jones recruitment
Royal mail charges £4.40 per parcel (quote all detail, including benefits eg insurance & tracking royal mail business pages 10/02/16)
Courier charges £3.13, plus £1.00 for signing Hermes
Check are all prices like-for-like eg incl./excl VAT, next day delivery, signed for etc.
Cost of journeys for own vehicles (eg diesel/petrol cost) assume 30mpg diesel, find average price per litre(360/(30/4.546)*£1.00)=£54.55

11. Calculations Drivers work 8 hours/day 20 parcels delivered by courier
Cost = 8*4*£12.42 = £397.44/day
20 parcels delivered by courier
20*£4.13 = £82.60
20 parcels delivered by Royal Mail
20* $4.40= £88.00
‘Break even’ drivers vs couriers, drivers would need to deliver:
£397.44/£4.13 = 97 parcels/day to match courier price
97/4 = 25 parcels each

12. More calculations Lease vs couriers Buy van vs couriers
Running costs vs couriers

13. More calculations Lease vs couriers Buy van vs couriers
(142*4)/4.13=137 parcels delivered over the month (=6.85/day)
Buy van vs couriers
11060/4.13=2678 parcels delivered
Running costs vs couriers
assume 30mpg diesel, find average price per litre(360/(30/4.546)*£1.00)=£54.55
54.55/4.13= 13 parcels

14. Overall findings
To match courier costs, each driver using a leased van would have to deliver:
25 parcels/day (wages)
7 parcels/day (leasing charge)
13 parcels/day (running costs)
45 parcels each
At 58 parcels per day a van would take 134 working days to pay for itself, ie 27 weeks after allowing 38 parcels/day for running costs and driver wages.
The feasibility of one driver delivering to 60 addresses per day would need to be explored.