USING MIS 2e
Chapter 8
E-Commerce & Supply Chain Systems
MARIA DEL MORAL
GROUP F
Q1 – How do companies use e-commerce?
 E-commerce occurs whenever goods and services are bought and sold
over public and private computer networks.
 Merchant companies take title to the goods they sell.
 Nonmerchant companies arrange for the purchase and sale of goods
without owning or taking title to those goods.
 The chart below lists the types of merchant and nonmerchant
companies.
Fig 8-1 E-Commerce Categories
Q1 – How do companies use e-commerce?
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B2C transactions occur between a supplier and retail customer. The
supplier generally uses a Web storefront.
B2B transactions occur between companies.
B2G transactions occur between companies and governmental
organizations.
Fig 8-2 Example of Use of B2B, B2G, and B2C
Q1 – How do companies use e-commerce?
• There are three types of nonmerchant e-commerce companies:
– Auctions match buyers and sellers using the e-commerce version of
standard auction where the auction company receives a commission
on each product that’s sold. eBay.com is the best-known example.
– A clearinghouse provides goods at a stated price, arranges for delivery
but never takes title to the goods. The company receives a commission
on each product that’s sold. Amazon.com is the best-known example.
– Electronic exchanges are a type of clearinghouse that’s similar to a
stock exchange. Whenever the company matches up buyers and
sellers and a transaction occurs, the exchange takes a commission.
Priceline.com is the best-known example.
Q1 – How do companies use e-commerce?
 E-Commerce improves market efficiencies in a variety of ways, as this
figure shows. Customers benefit from the first two, disintermediation
and increased price information. Businesses benefit from increasing
their knowledge of price elasticity.
Fig 8-4 E-Commerce Market Efficiencies
Q1 – How do companies use e-commerce?
• Businesses need to consider the economic factors that may disfavor
their participation in e-commerce such as these:
– Channel conflicts that occur when a manufacturer competes with its
traditional retail outlets by selling directly to the consumer.
– Price conflicts that may occur by a manufacturer selling directly to
consumers and undercutting retailers’ prices.
– Logistics expenses increase when a manufacturer must process thousands
of small-quantity orders rather than a few large-quantity orders.
– Customer-service expenses increase when a manufacturer must begin
dealing directly with customers rather than relying on retailers’ direct
relationships with customers.
Fig 8-4 E-Commerce Market Efficiencies