Learning Objectives (Chopra and Meindl)
1. Identity the role of e-business in a supply chain.
2. Evaluate the impact of setting up an e-business on revenues for a supply chain.
3. Evaluate the impact of setting up an e-business on costs for a supply chain; and
4. Identify factors that influence the value of e-business in a supply chain.
Identity the role of e-business in a supply chain.
E-Business or E-Commerce is the facilitating of enquiry, order booking and execution of order using internet facilities. Flow of information, delivery of certain products and funds transfer are taking place through E-business mode in supply chains.
Companies can do the following functions or activities with suppliers and customers through E-business mode or facilities.
Provision of information about products and facilities
Negotiation of prices and contracts
Tracking of order by customers
Delivery of certain products (electronic documents, e-books, music, videos etc., examinations)
Sending delivery information and payment instructions
Funds transfers and payments
Evaluate the impact of setting up an e-business on revenues for a supply chain.
E-business offers revenue-enhancing opportunities as well as cost reduction opportunities to business organizations.
Revenue Enhancing Opportunities
Direct sales to customers – disintermediation – Customers can view the full product line of the firm at their convenience and time of choice and also place orders at their convenience and choice.
Providing 24-hour access for information, order placing, and order tracking.
Availability of more and aggregated information about customers (CRM)
Providing mass customization
Faster time to market
Ability to provide flexible price quotes
Ability to provide differentiated services
Evaluate the impact of setting up an e-business on costs for a supply chain
Supply chain reduction
Efficient delivery of downloadable products
Reduction in order handling costs
Decrease in inventory costs due to centralized warehouses
Improvement in supply chain coordination and resultant decrease in costs
Electronic markets are communities of interest where in buyers and sellers come together, exchange information, discuss, negotiate and finalize deals in virtual space instead of physical space.
Additional Articles for more Information
E-Export – US Government Site
What is E-Commerce
Types of E-Commerce Sites
E-Payments and Taxes
Internet Auctions – A Paper