e-commerce

Question 1

what is the definition of e-commerce

Answer 1

e-commerce is the buying and selling of goods online.

Question 2

impact of e-commerce on HR 3

Answer 2

 Can spend less on employees’ wages as many of the tasks (accepting orders,
checking inventory) can be automated.
o Which will reduce the number of workers needed. could result in trade unions

 Training costs may be increased as employees need to be trained in new ways of
working. may have to find the finance elsewhere

 Shift workers may have to be employed at unsociable hours as people will be able
to buy goods 24/7 and may need employees available at help desks.
can become demotivating for employees

Question 3

impact of ecommerce on finance 3

Answer 3

 No cash transactions – all electronic funds transfer means that money is
immediately received meaning that keeping track of cash flow is more accurate.

 Payments for wages/shop rent and other related expenses are reduced as there
is no need for a physical outlet for customers to visit. can invest in other areas

 Investment in a website will increase costs in short term. as has to give the best experience to customers

Question 4

impact of e-commerce on operation 2

Answer 4

 Computerised inventory system should be used which will make the process of
inventory control more accurate.
o Accept advantages/disadvantages of electronic inventory control (such as
automatic ordering when inventory hits the re-order level).
jit advantages and disadvantages

 Goods for sale do not have to be kept on premises (warehouse) as the
organisation can be a ‘middle-man’ and order goods from their suppliers once an
order has been received from a customer.
o This will reduce inventory costs such as warehousing and security costs.

Question 5

impact of e-commerce on marketing 4

Answer 5

 Having a website to buy goods through can be used to advertise and promote
their company/products which is cheaper than traditional TV, Radio, Magazine
advertising. invest in other areas

 Details of customer’s preferences/spending patterns can be used to segment customers and save money by targeting
customers with specific deals.
-more likely to have sales and profits

o Customers can be regularly contacted to promote further deals.
 Marketing department may have to change the way they communicate with
customers.

o Less face-to-face communications and more electronic vouchers.