question_answer

Discuss the salient aspects of B2C commerce.

Answer:

Ans.     In this, both the parties involved are business firms and therefore, it has been named as B2B i.e., business to business. Historically, the term e-commerce originally meant for facilitation of B2B transactions using Electronic Data Interchange (EDI) technology to send and receive commercial documents like purchase orders and invoices.

Salient aspects of B2B Commerce:

(a) Need: Creation of utility requires a business to contact with a number of other businesses which

(i) May be suppliers

(ii) May act as channel of distribution.

(iii) Different middlemen in different locations;

(iv) Changing production as per specifications of the customer.

(b) Benefits:

(i) It strengthens and improves the distribution system of a firm. For example, each consignment of goods from a warehouse and the stock in hand can be monitored and replenishments and reinforcements can be set in motion as and when needed.

(ii) A customer's specifications can be routed through the dealers to the factory so that there may be customized production.

(iii) B2B E-commerce expedites the movement of information and documents.

(iv) It also expedites money transfers.

(c) Example: The manufacture of an automobile requires assembly of a large number of components which in turn are being manufactured elsewhere. To reduce dependence on a single vendor, the automobile factory cultivates more than one vendor for each of the components. A network of computers is used for placement of orders, controlling production and delivery of components and making payments.