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Dr. Ecommerce,

Two questions:

1. What is business-to-customer e-commerce?
2. What are the benefits of business-to-business e-commerce?

Best regards,

Kathy

Dear Kathy

E-commerce is generally broken down into two categories:

1. Business-to-consumer e-commerce (popularly referred to as B2C); which is selling goods directly to consumers (as in any shop in the real world). This is the side of e-commerce that you see when you order a book or software or flowers or anything else on the Internet.

2. Business-to-business e-commerce (B2B); which is businesses selling to other businesses. For example, when a shop (whether an electronic one or a real-world one) orders new products for its shelves or a factory orders new steel to make its products.

Business to business e-commerce offers benefits in cost savings and improved efficiency. Consider a completely electronic example: a supermarket that uses bar-code scanners at the cashier (it also uses bar code scanners in other areas to monitor incoming inventory, what's on the shelves, pricing and more). A computer is able to keep track of inventory, monitor buying trends and order new products when necessary. The new orders are made via a network to the computer at a factory. This computer takes note of the order, and sends information to the sales department, production department, distribution department and accounting department to insure the sale is made, the products are produced and delivered and a bill is sent.

Because computers can do this automatically, it saves on the cost of staff performing all operations. Also, because computers can provide precise and up-to-the minute information, the supermarket is able to order precisely what it needs when it needs it. That way less storage space is needed and fewer products become spoiled because they are not sold in time. By monitoring buying trends, the owners of the supermarket can make observations about new products that might interest their consumers and when is a good time to have a sale to clear excess inventory.

Dr.Ecommerce