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Types of Electronic Commerce Models

Electronic commerce varies depending on the type of service provider and its context. We have mentioned six items of types of electronic commerce models in the following:

1- B2B Electronic Commerce (Business to Business)

2- B2C Electronic Commerce (Business to Consumer)

3- C2C Electronic Commerce (Consumer to Consumer)

4- C2B Electronic Commerce (Consumer to Business)

5- B2A Electronic Commerce (Business to Administration)

6- C2A Electronic Commerce (Consumer to Administration)

B2B Electronic Commerce

B2B Electronic Commerce in simply defined between companies. It means transactions and services that a company (or factory) provides for another.

In B2B model, a company or firm proceeds through network for submitting order to manufacturers, receiving pre-invoice, sales invoice, paying the purchase amount and related expenses.

B2C Electronic Commerce

The business to consumer electronic commerce includes retail trade. This type of commerce forms among the seller and the consumers. It means that consumers can have access to the shop and choose what they need, order and pay using the network.

This type of commerce increases as internet spreads. Nowadays, in developed countries different kinds of goods can be traded via internet. B2C electronic commerce has many advantages for both buyers and sellers.

Comparing to traditional commerce, in internet retail trade, consumers can receive these features by doing their purchase online:

1- Product’s catalogue and information are easily accessible and the consumer can receive more information about the product.

2- Doing purchase is possible 24 hours a day.

3- There is no mental pressure while people are shopping.

4- It is possible to compare various kinds of goods in different stores.

5- The buyer can easily choose the most acceptable price.

6- After choosing the product and paying its amount, the buyer will receive it at the house door quickly.

C2C Electronic Commerce

Consumer to consumer electronic commerce has emerged recently. The amount of this type of electronic commerce is much less than the other two that were discussed.

Generally, these transactions are done through a third party, who provides an online platform in which real transactions are done. This type of electronic commerce is mostly used for tenders, auctions and public sales. In this type of commerce, consumers advertise their products along with the specifications and prices; others can check this information and buy the products.

C2B Electronic Commerce

In consumer to business commerce, the trade is the reverse of traditional commerce. In this type of electronic commerce, many people offer their services or products on the internet so that the companies that are exactly looking for those kinds of services and products, would buy them.

Websites in which some designers offer prices for designing a logo for a company and only one of them will be accepted and bought effectively, are samples of these methods.

B2A Electronic Commerce

Business to administration is an electronic commerce that includes the entire commercial-financial trade-ins between companies and governmental organizations. Meeting government needs by companies and paying taxes are some of the cases that can be included in this category. B2A commerce has been considerably increased in recent years.

C2A Electronic Commerce

Consumer to administration commerce includes every electronic trade between individuals and governmental administrations. Governments will expand electronic trades to the scopes such as fundraisings, income tax payment and any other commercial affairs that is being done between people and governments.

Examples of the plans include:

• Education – Information release, distance learning, etc.

• Social security – Via information distribution, payment, etc.

• Taxes – Tax refund, payment, etc.

• Health – Appointment, information about illness, providing health services, etc.

Both mentioned models, including electronic commerce with governmental administrations (B2A and C2A) are strongly related to efficiency and easy use of services provided for citizens by the government, supporting information and communication technology.

The Advantages of Electronic Commerce

- Removing spatial and temporal constraints

The internet being available to all the people around the world and electronic connections expanding through websites, have created a lucrative commerce with no geographical, spatial or physical limits. In web design, which does business today, audience and customer attraction has turned to a competition for making money online.

- Increasing sales percent and easy access to required information

The main advantage of electronic commerce is its ability to reach a global market and it doesn’t necessarily mean a great economic investment. This type of commerce, which has no geographical constraints, allows customers to have global options, receive the required information and compare all the potential providers’ offers without considering their situation.

- Removing brokers

Removing brokers is another one of valuable achievements of electronic commerce that have caused unprecedented decline in service and commodity prices in the world. According to the estimations, removing brokers and direct connection between buyers and sellers, has decreased the fixed price of all services and commodities 10-15 percent for customers.

- Reducing transactions costs and work duration

Another advantage of electronic commerce is that you will be able to buy your required products as an order the way you prefer. Finally, the customer can help to fix the product’s defect by giving different information about the product they bought and communicating online with the manufacturer company. Companies that sell their services and products with this method are constantly connected to their customers using different, fast and low-price ways and such strong support encourages people to buy their stuff online.

Disadvantages of Electronic Commerce

- Privacy and security

Check the security certifications (such as Electronic Trust Symbol, etc.) of the website before online transactions. It’s true that online purchase is simple and easy, but no one wants their personal information to be stolen. Many websites are reliable but you still have to investigate and recognize the ones that are not secure enough.

- Quality

Although everything is easily accessible by electronic commerce, a customer can only see and touch the product after buying and receiving it. Therefore, you should check how can you return the product in case of dissatisfaction, before buying it. Always make sure that there is a way for returning the product before you do the purchase.

- Hidden costs

Customer is informed about the price of the product, transportation, loading and taxes. But you should be careful because there may be some hidden costs that aren’t mentioned in your receipt but show up on the platform. There may be extra expenses (handling fee) for relocating and loading (especially for international purchases).

- Requiring internet

Internet is not free to use and if you’re using free Wi-Fi, it is possible for your information to be stolen on an insecure website. If you don’t want to use free internet or can’t have internet in your own house and computer, you should better do your purchases in person.

- No person-to-person interaction

Although the terms and conditions of any business in electronic commerce is available for you to study, there are so many contents that you need to read and the legal issues may be confusing for you. Moreover, there is no one to talk to about your questions or concerns face to face in case of big orders.

Final Word

Electronic commerce is progressing very fast and using social networks like YouTube, Twitter, etc. is the easiest way for setting your business online. Notice that the limited networks aren’t inactivated! Choosing the right social networks will definitely help you to be seen and find your customers easier. Try to choose a social network that is proportionate to your business and know that there are many users on Twitter, Facebook, YouTube, etc. so don’t stop trying and take the strategy to success.

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