E-commerce has been used by businesses in the past century to modify and enhance their business strategies. The choice of a model of E-commerce by a given business entirely depends on the type of industry it operates in and the prospective customer the entity seeks to serve with its products and services (Senarathna et al., 2014). For example, organizations like Home Depot and Ace Hardware that tend to operate more in the do-it-yourself home improvement industry use different tailor-made e-commerce platforms to meet the needs of their existing and prospective consumers in the market. In a broader perspective, E-commerce mainly relates to the flow of materials and information in the business value chain and the underlying Enterprise Information System (EIS) (Liu, Chen, & Lu, 2015). Purposely, E- commerce seeks to facilitate supply, distribution, collaboration, coordination, and customer information among the many trading partners in the value chain. However, this paper will focus only discuss two E-commerce models; Business to Business (B2B) and the Business to Consumer (B2C) by analyzing the supply chain management, performance enhancement, and security in the two models (Senarathna et al., 2014).
B2B and B2C are the two primary forms of commercial business transactions. A B2C process is a process through which a business sells directly to a consumer (Becker, 2008). Conversely, a B2B is a system through which a business sells directly to another business venture with no middlemen (Sharma, & Lijuan, 2014). As seen from the two definitions, the different business systems that support both B2C and B2B do differ regarding their complexity in fields related to sales administration, transactions, and communication. As a result, it is important for a business to administer the right system for its customers.
Forming part of the fundamental differences between B2B and B2C business systems is the size of the purchase in both cases. In B2B, the purchase volumes tend to be more than in B2C (Senarathna et al., 2014). This difference stems up since, in the B2B systems, the customers have established businesses with a higher potential to buy in bulk than in the case of a B2C. Some of the most common transactions that represent B2B set ups will include a supplier selling to a wholesaler, a manufacturer selling to a supplier, or even a wholesaler selling to a retailer. However, in a B2C setting, the business sells directly to its final consumer, thus, eliminating intermediaries. Business to consumer settings will in many cases fail to sell to other firms. The net effect of selling to the final consumer is that businesses in a B2C setting will have to maintain low stocks since their clients often have a lower purchasing power than in the case of a B2B setting. Sharma and Lijuan (2014) asserts that businesses will hold lower stocks, meaning they enjoy fewer security risks associated with their operations than in the case of a B2B where security stock has to be high to cover up for unforeseen demands.
Regarding maintaining their supply chain systems, the B2C settings has greater responsibility to ensure that its supply chain management system is well lubricated and perfect to ensure timely delivery of the promised goods and services to the end consumer. In the event a B2C vendor delays in delivering their promise, it is so easy for a customer to find another supplier of a similar product promptly (Liu et al., 2015). Consequently, all the players in a B2C supply chain system have to be flexible, professional, and have the right capability to accommodate future changes in supply patterns. For example, major e-retail companies like Amazon must ensure that they deliver products to their consumers in good time, otherwise, they risk losing them to their competitors like e-bay. Conversely, in the case of a B2B setting, the supply chain system is relaxed and poorly managed as compared to the B2C one. Businesses that double up as clients in this system have the potential to hold inventories for future use, unlike final consumers. As a result, the question of timely delivery is not so much a bother in the B2B settings as it is in the B2C setting (Liu et al., 2015). This difference generally implies that the B2C setting requires better management of the supply chain than in the B2B setting.
In performance measurement and enhancement, the concerns for business improvement suggest that establishment of performance enhancement is easier in B2C than in the B2B. The end consumer will tend to be more sensitive than a business entity in terms of meeting their particular needs (Liu et al., 2015). A business will have an option of speculating several consumers to purchase their products or services, unlike the end consumer who will in most cases aim to get whatever they targeted from the word go. The strict targets set by consumers in B2C make it easier for any entity to maintain or achieve higher enhanced performances than in the case of a B2B setting where there is a leeway for escaping. Liu et al. (2015) assert that should the partner business feel disgruntled; the seller entity has the freedom of selling the same to another business whose consumers demand what another business does not wish to stock.
A common challenge that both B2B and B2C e-commerce face is the fact that the market has enough knowledgeable customers unlike before (Petty, 2012). Therefore, meeting the needs of the customers is quite a big task for businesses in any industry. As a result, B2C companies have changed tact to work towards retention and loyalty building in their customer bases (Liu et al., 2015). The nature of this operation is that companies focus beyond the acquisition of customer and place an equal on retaining them. Nevertheless, Sharma and Lijuan (2014) state that B2B companies have over the years tried to exploit customer experiences and commerce capabilities that have proved worth in terms of winning business from B2C companies. Therefore, it is upon modern businesses to decide on which model to employ based on their structures, market, and objectives.
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