Week 7 - B2B Commerce Flashcards
To be able to describe the basic types and characteristics of B2B. To be able to describe supply chain management and illustrate how businesses are using Internet technologies to improve it.
Explain the term extranet
Privately connected, over a public network.
A way to extend a company’s network to selected external users in a controlled, secure manner, whilst maintaining privacy.
Example: a company might set up an extranet to allow its suppliers to access inventory levels or place orders directly into their system, without giving them access to all of the company’s internal information.
Explain the term intranet
Local network, only accessed by employees within the internal organisations network (e.g., cannot connect at home) Business documents are usually stored on an intranet.
A digital space where employees can access information, communicate, collaborate, and work together on various projects
B2B Business
Transactions between businesses conducted over the Internet, extranets, intranets, or private networks. It is the most common form of e-commerce.
Elements of a B2B Business
Networks - internet, extranet, intranet or private
EDI
Supply Chain Management - manufacturer, wholesaler, retailer, consumer
Electronic Intemediaries - e.g., Amazon or eBay
Describe the transition from traditional EDI (electronic data interchange) to new internet methods
The transition from traditional EDI to internet methods allowed for the removal of the EDI translator, point-to-point connections.
The internet acted as the intermediary & provided value-added-services, allows encryption to maintain privacy while data is being transferred. Ultimately, it allowed free & seamless connections with anyone you pleased.
Traditional Supply Chain
Supplier (Raw Material) > Manufacturer > Wholesaler > Retailer > Consumer
SCM (Supply Chain Management)
Supply chain is simply the activities associated with the flow of goods to end users.
Supply chain visibility is critical, particularly when needing to trace products / components back to its original source.
The internet has simplified business procurement - reducing search, research, negotiating costs.
Internal S.C
In-house processes used in transforming the inputs into the organisation’s outputs (you control)
Upstream S.C
Items coming into your organisation (raw materials, procurement)
Downstream S.C
Items leaving your organisation (delivery, mktg, after-sale service)
activities involved in delivering the products to final customer.
How can blockchain improve a supply chain?
Allows traceability, accountability, transparency & also sustainability
Ethics in SCM
- Environment (waste, emissions, biodiversity etc)
- Social (local community affects, employment etc)
- Ethical (labour, wages etc)
List the 4 Supply Chain Management Functions
- Customer asset management – managing information about demand to understand customer needs
- Integrated logistics – managing the flow of physical goods from suppliers, includes production planning, procurement and inventory management
- Agile manufacturing – optimising the cost of manufacturing (similar to Just in Time manufacturing)
- Financial and accounting management – managing the financial flows with suppliers and customers
Explain the bullwhip affect
Erratic, unpredictable fluctuations between demand & supply (buying & selling patterns). Prices will shift depending on demand, high demand = drives prices up.
Either too much is produced that is not bought, or you cannot produce enough to meet demand).
AI tech may be used to predict & avoid thes fluctuations.
What is the difference between spot purchasing and contract purchasing? When would you purchase using spot purchasing and when would you purchase using contract purchasing?
Spot purchasing entails the purchase of goods and services as they are needed, usually at market price. You would buy with spot purchasing when there are unforeseen circumstances & you need supply quickly.
Contract purchasing involves long-term contracts, where buyers negotiate ahead of time with their supplier. An example may be a car manufacturer may enter into long-term contracts with suppliers for raw materials such as steel, aluminium, and plastics.
