Which Businesses Do Not Use eCommerce?

While online businesses are on the boom across the world, there are still quite a lot of businesses that do not use eCommerce. To put it simply, their business objective does not seem to have a requirement for an online business platform. So let us have an idea of which businesses do not really use eCommerce as their business requirements, and whether they can get accustomed to the eCommerce platform to enhance their reach and reception.

Usually, it is the small-scale businesses that do not use any form of eCommerce platforms. According to a survey published by SurePayroll in their monthly Small Business Scorecard, it shows that only a meager 26% of small business owners agree to use eCommerce platforms or have their own sites. On the other hand, 74% of small businesses say that they do not find any need to make use of eCommerce platforms for their business.

In most cases, a number of business factors play a significant role in determining whether at all a business will switch to an eCommerce platform. For example, the location and the target audience are two defining factors regarding the same. Most of the small-scale businesses operate within a small location and so their target audience is also limited. As a result, they do not feel any inclination to reach a wider audience through eCommerce.

Rather, they depend on conventional marketing mediums like word of mouth or local classified ads to promote their products. If a small scale entrepreneur opens a shop in a convenient area of a locality, it does him quite good as lots of people will automatically walk in there and start buying.

Secondly, most of the small-scale businesses do not have a huge product base and so they do not find the need to reach the wider audience. In most cases, their products may be even based on the tastes and preferences of a particular geographical area where they are located. As a result, there is no need for an eCommerce platform to promote the items.

Last but not the least; budget plays an important factor for businesses when it comes to eCommerce. In case of small businesses, they would rather prefer to have a small brick and mortar store rather than a website. They mainly depend on the regular customers who walk in and shop rather than tech-savvy users. Moreover, small-scale businesses prefer cash transactions rather than electronic transactions.

Some of the small-scale businesses that do not use eCommerce may include local grocery stores, handicrafts and cottage industry stores, local restaurants and dining outlets and so on. Nevertheless, with the world turning towards technology in all aspects, it helps to make use of eCommerce for the promotion of business. Although they may not want to sell through eCommerce, they can use it to let more people know about their business and lure customers. It can be done on a small scale but may yield great results for the business.

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Types of eCommerce Business Models, Pros, and Cons

The first thing that comes to our mind when we talk about eCommerce is an online commercial or sales transaction between the supplier and the customer. While the idea of the concept is right, there are more specific factors involved that categorize eCommerce into six major types. Based on the services offered, several types of eCommerce models have been developed over the years. The major categorization is based on the customers and the seller.

Each of these types has different features and attributes.

Typically, eCommerce business models can be divided into six major types, such as:

  • Business-to-Business (B2B)
  • Business-to-Consumer (B2C)
  • Consumer-to-Consumer (C2C)
  • Consumer-to-Business (C2B)
  • Business-to-Administration (B2A)
  • Consumer-to-Administration (C2A)

Business-to-Business (B2B)

This type of eCommerce consists of all the electronic transactions and dealings related to goods and services. These basically are conducted between companies and include conventional wholesalers and producers dealing with retailers.

Business-to-Consumer (B2C)

The Business-to-Consumer e-business model is related to the transactions and relationships between businesses and the end customers. This is mainly to do with the retail eCommerce trade that takes place online. With the inception of the internet, B2C eCommerce has evolved to a great extent.

Today, we find scores of electronic shopping sites and virtual stores on the web that sell myriad products, ranging from computers, fashion items and even necessities.

In this case, the customer has more info about the products in informative content, and there is also a chance to buy products at cheaper rates. Most times, quick delivery of the order is also maintained.

Consumer-to-Consumer (C2C)

This eCommerce model consists of electronic transactions of products and services between two customers. These are mainly conducted through a third party that provides an online platform for these transactions. Sites where old items are bought and sold, are examples of C2C eCommerce.

Consumer-to-Business (C2B)

In this eCommerce business model, a complete reversal of the selling and buying process takes place. This is very relevant for crowdsourcing projects. In this case, individuals make their items or services and sell them to companies. Some examples are proposals for a company site or logo, royalty-free photographs, design elements, and so on.

Business-to-Administration (B2A)

In this kind of eCommerce transaction, there are dealings between companies and public administration. It encompasses different services, such as social security, fiscal measures, legal documents, employment, etc.

Consumer-to-Administration (C2A)

In this eCommerce model, electronic transactions are carried between individuals and public administration. Some examples are distance learning, information sharing, electronic tax filing, and so on.

The main objective of both the B2A and C2A types of eCommerce is to increase flexibility, efficiency, and transparency in public administration.

Pros of eCommerce

Perhaps the greatest benefit of eCommerce is its huge reach and reception across the global market, with minimum investments. It enables sellers to sell to a global audience and also customers to make a global choice. Geographical boundaries and challenges are eradicated drastically reduced.

Through direct interaction with final customers, this eCommerce process cuts the product distribution chain to a significant extent. A direct and transparent channel between the producer or service provider and the final customer is made. This way, products, and services are created catering to the individual preferences of the target audience.

The process of eCommerce enables sellers to come closer to customers that lead to increased productivity and perfect competition. The customer can also choose between sellers and buy the most relevant products according to requirements, preferences, and budget. Moreover, customers now have access to virtual stores 24/7.

eCommerce also leads to significant cost reduction. It leads to a significant reduction of transaction costs, and accordingly, customers also get to buy at a lower rate.

Cons of eCommerce

eCommerce has its share of disadvantages too, such as:

  • It depends strongly on network connectivity and information technology
  • There aren’t definite legislations both domestically and internationally to regulate eCommerce transactions
  • The whole market culture is not favorable to electronic commerce (for example customers cannot try the products)
  • At times, there is a loss of the privacy, culture or economic identity of the customer
  • There is a chance of fraudulent financial transactions and loss of sensitive financial information

Nevertheless, the pros outweigh the cons when it comes to eCommerce. With innovative eCommerce processes in vogue, it is expected that these limitations will be done away with.

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