Roles of e-Commerce in Practical Business Applications

Freshman (College 1st year) ・Business ・APA ・3 Sources

Today, many companies move from traditional transaction methods to electronic methods. You use e-commerce to support traditional methods, create more business opportunities and achieve competitive market advantages. Companies are currently using e-commerce in areas like supply chain management, e-Payment, sales forecasting, e-tailing, etc. E-tailing, for example, enables companies to interact with customers and make online sales (Chaffey, 2007). E-Commerce is also used to track stock movements in supply chain management and inventory control. Electronic payments, on the other hand, continue to gain popularity in business operating in both formal and informal sectors. Other than the banking industry, e-commerce is widely applied in all types of business to improve efficiency. Other practical applications are e-Coverage, e-Procurement, and e-Marketing.

Techniques and Tools used to evaluate the driving forces of e-Commerce

The driving forces in e- commerce can be assessed by the use of porters five forces analysis, pestle analysis, SWOT analysis, and the cost- benefit analysis. Porters five forces analysis helps in assessing the profitability and industry competitiveness attained using e-commerce. SWOT analysis helps in evaluating the strengths, weakness, opportunities, and threats that a business may encounter because of e-commerce (Hajli, 2014). Cost- benefit analysis, on the other hand, helps in evaluating e-commerce in terms of benefits and costs to a business.

e- Commerce and Competitive Advantage

Pressures from technological advancement increased customer needs, and increased focus on efficiency have necessitated the adoption of e-commerce. Using e-Commerce and e-business, firms have been able to improve their service delivery, facilitate sharing of business information through the extranet, receive payments, and sell goods through the internet (Chaffey, 2007). Besides, firms have forged a lasting relationship with their clients through the creation of online customer support services. Since businesses are keen on reducing their operation costs, improving efficiency, and improving the quality of goods and services, the use of e-commerce has enabled them to overcome the pressure from their competitors and customers hence gaining a competitive advantage (Da Costa, 2016). Furthermore, it offers business an avenue to establish a global presence by reaching customers from all corners using web-based services.

Question Two

e- Business

The e-business will involve designing of business and wedding cards online. The main customer segments for the products will be couples, brides and grooms, business owners, and individuals who want their business and wedding cards designed. Starting the business will require a laptop, internet connection, and business website. Our products will be advertised only through a variety of internet search engines. Customers will log in to the website and order for the products. Payments for the products will be through PayPal and Skrill only. Once payments are made, clients will be allowed to download printable versions of the cards. Since the business will be done online, customers will be obtained through referrals and internet marketing.
The start-up cost for the business is as follows;
Laptop = $ 3500
Web hosting Fee = $ 500
Internet Connection Charges = $ 500

Question Three

The e-commerce company selected is Facebook Inc. The following information are available for the financial year ended 31st December 2016:
Current Assets=$ 34 401 000
Total Assests=$ 64 961 000
Current Liabilities=$ 2 875 000
Total Liabilties=$ 5 767 000
Total Equity=$ 59 194 000
By definition, the total assets of a business must be equal to the total liabilities plus total owners’ equity. Mathematically, Total Assets = Total Liabilities + Total Equity
$ 64 961 000 = $ 5 767 000 +$ 59 194 000
$ 64 961 000= $ 64 961 000. Hence, the balance sheet balances.


Chaffey, D. (2007). E-business and E-commerce Management: Strategy, Implementation and Practice. Pearson Education.
Da Costa, E. (2016). Global e-commerce strategies for small businesses. Mit Press.
Hajli, M. N. (2014). The role of social support on relationship quality and social commerce. Technological Forecasting and Social Change, 87, 17-27.

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