FACULTY OF COMPUTING AND BUSINESS

MANAGEMENT

BBED 4103
E commerce

ASSIGNMENT
(Individual Work)
JANUARY 2012 Trimester
Date Assigned:
Due Date: 05
th
March 2012
Lecturer: 30%
Weighting:




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Appendix 1


OPEN UNIVERSITY MALAYSIA
FACULTY OF INFORMATION TECHNOLOGY AND
MULTIMEDIA COMMUNICATION


Course Code: BBED4103
COURSE NAME: E - Commerce


Name: Ibrahim Asad
Student ID Number: S10721600
ID Number: A273706
Telephone: 7972059
Email address: Ibrahim100_asad@hotmail.com


Tutor Name: Mariyam Nazviya

Learning Centre: Villa College



Trimester: January 2012

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Introduction:
Business Nature & Employment Size:
Koolkids is a virtual store, operating from the house of Aisha. Aisha started posting
pictures on Facebook of attires she purchased for her kids, Ethan (5 years) and Zuha (3 years)
from her last visit to India. She never thought that it could change her life forever. Within 24
hours she got more than 100 likes for the posted pictures. Lots were commenting on the
pictures, asking her to sell attires for their young ones. This was the starting of her small
retail business, Koolkids.
Koolkids is a family based business, managed by Aisha and her husband Ahmed.
Ahmed suggested Aisha to create a page for their business on Facebook. Koolkids started
their business operation on the social network Facebook, 15
th
of June 2011. There business is
operated from the house of both the sisters located at Raiymandhoo, Meemu Atoll.
Mission:
Every wife and husband would love their children to wear beautiful clothes. They
want them to look cool. Definitely, Aisha and her husband want their children to look cool,
and wear beautiful attires. This was how the mission statement of Koolkids was formed. The
mission statement of Koolkids is We make your Kids look cool.
Vision:
It is the vision of Koolkids is to establish itself as a well-known retailer and marketer
of kids wear within the next 5 years.
Employment Size:
Today, there are two more staffs in the operation of Koolkids, apart from Aisha and
her husband Ahmed. They are two sisters of Aisha, Mariyam and Fatima. Mariyam is
responsible for marketing the kids attires on Facebook. The responsibility of Fatima is to
suppliers, who sell quality products at an affordable price. Aisha manages the day to day
operations of Koolkids, whiles Ahmed finances the orders to be made on behalf of Koolkids.
The diagram below shows the organizational chart of Koolkids.
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(Figure 1.1)
Existing Issues & Business Challenges Faced by Koolkids:
Within the past few months, Koolkids have increased their customer database. Firstly,
within the first few weeks they had only ten to fifteen customers. However today, Koolkids
enjoys a customer database of 500 active clients on Facebook. The increase in customers and
the small scale of operation Koolkids enjoys have lead to challenges and issues. The major
challenges faced are the following.
Meeting with the customer demand
Koolkids was solely targeted for customers within Meemu Atoll. However, effective
marketing campaigns through Facebook and customers satisfaction lead to increase in
demand for the attires of Koolkids. As Aisha and her husband gets few hours to interact with
the customers, as both are working, and have to attend their children. Thus, Koolkids is
unable to meet the demand of their customers. Furthermore, effective marketing campaigns
conducted with the help of Facebook have lead to potential customers, beyond the borders.
Koolkids is unable to supply beyond Meemu Atoll, as currently Koolkids uses Inter Atoll
Ferry chain to deliver the attires to the customers.
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Competition & Poor Public Relations:
With the increase in customers, Koolkids has been facing competition from
competitors. The competitors are delivering the kids wear products to anywhere within
Maldives. Similarly, they have launched marketing techniques and promotions on Facebook
and their own commercial websites. Furthermore, the competitors are flooding the page of
the Koolkids with the links of their promotional offers and links. Similarly, some of the
comments from customers have negative effect on the business of Koolkids. Due to this some
of the customers have been lost. As day by day, competition is getting intense Koolkids has
to find an effective mechanism to retain their customers and fight with the big players.
Acceptance of Payment Online:
Fatima every week travels in the ferry to deliver the kids attires to the clients of Koolkids.
Koolkids uses a traditional payment mechanism. Kids wear are released to the clients, when
they only pay cash. However, the customers sometimes over pay and sometimes underpay as
they do not have exact amount in cash. Similarly, there are concerns about accepting cash of
Mrf. 500, as there is lots of forged Rufiyaa rolling in the community. Personally Koolkids
have experienced similar situations, leading to financial losses in their infant stages.
Similarly, customers have been requesting Koolkids to arrange an online payment
mechanism.


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Proposal of electronic commerce model as the solution
The challenges faced by small organizations such as Koolkids can be eliminated from
a well managed electronic commerce model. This model is a combination B2B and B2C
model. This model shows a combination of e commerce and traditional commerce as well.
This model can be explained in stages.
Stage 1:

Figure 2.1
(Adopted from: Eserveglobal)
In this stage, Koolkids would be searching for suppliers, who would provide them
with childrens attires. When they find a suitable supplier through internet, they would
approach the supplier. Orders would be sent to the suppliers, through the website of the
supplier. Instantly, the supplier would provide an invoice, stating the terms and conditions.
When Koolkids agree with the terms and condition of the supplier, the supplier would
dispatch goods and services to the Koolkids physical shop or the warehouse of Koolkids
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located in M. Raiymandhoo. When the goods are received, Aisha and her husband will
update the website of Koolkids. This stage ends when the Koolkids pay to the supplier.
This transaction can also be termed E- distributor. E-distributors is a form of business
to business (B2B) e commerce model, where businesses performs on web based or semi
web based platforms and, supplying goods and services directly to the individual businesses.
(Bachok & Seng, 2010)
Stage 2:
In the next stage, the Koolkids will determine the selling price of the kids wear. Aisha
and her husband will take into account the cost of fright charges, import duty, cost of the
items and transportation cost incurred. After this, the selling price of the items would be
updated. This process is conducted within the organization.

Figure 2.2

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Stage 3
As seen in the diagram below, with the help of the e-commerce model, Koolkids
would attract customers. With the help of the marketing techniques such as advertising and
promotion, this e commerce model would attract customers.

Figure 2.3
Stage 4:

Figure 2.4(Adopted from: Eserveglobal)
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This is the fourth stage of the e-commerce model. This process starts due to the
effective marketing techniques used by Koolkids in the stage 3. The customer orders the kids
cloths from the website of Koolkids using the internet. Instantly, Koolkids receives the
orders. If the customer agrees with the terms and conditions of Koolkids, they will confirm
the order and pay the payment. Koolkids website would accept payments online, and these
payments would be banked instantly. Then the delivery process starts. The items are packed
and delivered to the customer homes, with the help of delivery agents who are employees of
Koolkids. With every sale, the website would be updated.
This stage can be said as E-Tailing. An E-tailer is a form of Business to customer e-
commerce method, where customers can access to the inventory and can place orders for the
goods and services they like from the websites with the help of internet. (Bachok & Seng,
2010)
The diagram below shows how the proposed E-commerce model for Koolkids would
operate.

Figure 2.5
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Features of the Proposed Online Shop:
An online shop is will not fully function if it includes pictures or if it does not have
interaction with the customers. Similarly, it should be built according to the needs of the
customers. The following are some of the features that would exist in the online shop of
Koolkids.

1- Capability to take orders online
Each customer has to register her or himself to order the kids wear online. To register, the
customer has to click the register button in the Koolkids homepage. When the customer
clicks the register button, he would be directed to the following page as seen below.

Figure 3.1, Adapted from: (Ebay, 2012)
The customer has to share basic information of her or himself to Koolkids. He or she
has the right to create a user ID and a password. This user ID will help Koolkids to know the
quantity the customer wants to buy. Before submitting the information, the customer has to
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read the user agreement and privacy policy. Similarly the customer has to be at least 18 years
old. This is to stop children from unknowingly purchasing the items they wish to wear.
This website gives the customer the guarantee with the help of the sign TRUSTe
and VeriSign Secured that their information and the orders that they place is at safe hands.
The image seen below is a screenshot taken from the website of the Koolkids. From
this website, the customers can order attires for boys, girls and kids and babies. Similarly,
they can give a search for a particular brand of products. As seen from the print shot, the
customer can buy the goods online. Or they can put all the items they want in the cart, as seen
in the right corner. Similarly, while taking the order customer can suggest the colour and the
size and quantity that they want respectively. Furthermore, this website enables the customer
to know the quantity available. The customer can by one item or can buy lots of items.
Currently, the user has 9 items in the cart. This means that he or she has ordered nine items
from Koolkids, which are pending for payment.
There would be items which customers want to buy later, may be for the birthdays or
such special occasions. In such situation, the customer can add an item or lots of items and
order them when they wish.

Figure 3.2Adopted from: (Ebay, 2012)
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2- Facilitate on-line payments
One of the difficulties Koolkids faced was the in-ability to accept payments online.
Lots of customers have commented on the official page of Koolkids to implement an online
payment mechanism. However, Facebook was used only as a marketing tool. Facebook does
not accept payment or pay payments on behalf of its users, Koolkids was unable to accept
payments online. Similarly, Koolkids had the policy of accepting payments when delivering
the items on cash basis. However, with the implementation of the website of Koolkids,
customers would be able to pay online for the items that they have ordered from Koolkids.
The customer can either click the cart seen on the right hand corner of the screen, or can
click buy it now button on the page of the item as seen in figure 3.2. If the customer does any
of these actions, it would redirect the customer to the online payments page.

Figure 3.3 Adopted from: (Mountain Media)
This is how the online payment page of Koolkids would look alike. From this, the
customer would know the items in their cart. Then can select to pay all the items or one of the
items. Similarly, the customer can pay Koolkids with credit cards and online checks. The
customer can use Visa Card, Master Card, and American express card. These cared are the
most well known and trusted cards in the world. In order to continue with the payment of the
item, the customer finish writing the card number, Expiry date and security date, the
customer should end the process of online payment by clicking the button Process
Transaction Now.
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3- Facilitating product delivery arrangements
Product delivery becomes faster and easier with the help of e commerce. This process
would further become efficient, if the e commerce website is synchronized with accounting
and inventory management software. When the customer visits the website, they would know
the number of items available from the inventory. When the customer orders and pays for the
items they order website of the Koolkids communicates with the inventory management
software.

Figure 3.4(Adopted from: Eserveglobal)
The inventory management software will order the employees operating in the
physical shop or the warehouse to transfer the products to the doorstep of the customer. When
the Koolkids deliver the items to the customer door steps, delivery team as will inform
Koolkids.

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4- Synchronized Marketing through online media and website
As stated in the e-commerce business model of Koolkids, marketing strategies is the
key component which triggers the customer attention. Today, most of the businesses have
invested in developing websites of the businesses, spending on marketing campaigns through
online media and social networks.
Currently Koolkids uses, Facebook to market the items. Today there are customers,
who are not active in Facebook. Thus, I believe that, Koolkids should use the most well
known social networks. Today, Facebook accounts can be synchronized with Twitter and
Google Plus. This would help to spread the news of promotions as well as inform the
customer about the arrival of new products.
The use of printed media is declining day by day. Most of the well known
international printed medias have switched to online platforms. They are moving to social
networks with the help of applications. Similarly, in Maldives the demand for online media
has been increasing day by day. Today, Haveeru.com.mv and Sun.mv have the read online
new in Maldives.

Figure 3.5 Adapted from: (Haveeru, 2012)

Figure 3.6 Adapted from (Sun, 2012)
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When the items are displayed such as in figure 3.5 and 3.6 customers would definitely visit
the website of Koolkids. When customers visit the website, they should know that as seen in
the online medias there is a promotion. Or there are beautiful items available at Koolkids. If
not, the customers would not visit the site again. Hence, the website of the Koolkids and the
online media should be synchronized as seen below.

Adopted from: (Ebay, 2012)
Synchronous marketing can be achieved, when linking one website with the other. For
example, when the reader of Haveeru or sun clicks the advertisements, it should lead to the
website. Similarly, when updating the status through social networks, Koolkids can provide
links of the websites.
Recommendation:
This model would help to expand scale of operation of Koolkids. Similarly
synchronization of marketing with online medias and social networks would help to boost
the customers visiting the virtual store of Koolkids, thereby increasing the revenue of
Koolkids. Furthermore effective and efficient inventory and delivery management techniques
would help to provide satisfaction and customer loyalty.
To effectively run the Koolkids as an online virtual store, the employees of the
organization should be trained. If the employees are not trained to the use of the website, and
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IT background of the e commerce websites, it may collapse the business of Koolkids as the
employees would not be aware of who placed the order and where to deliver it.
Secondly, this e-commerce model is created to cater a wider market. Thus, Koolkids
should employee more staffs to provide prompt services to the customers. In delivery, as the
islands are dispersed geographically, Koolkids can outsource the delivery process.

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Reference

Bachok, S. H., & Seng, Y. C. (2010). BBED4103 E-COMMERCE. Open University
Malaysia.
Ebay. (2012). Clothing Shoes and Acessories. Retrieved 03 March, 2012, from Ebay:
http://www.ebay.com/itm/Girls-dress-white-butterfly-children-clothes-2-3-4-5-6-
/320826615582?pt=US_Childrens_Clothing_Girls&var=&hash=item4ab2c1a71e
Ebay. (2012). Home Page. Retrieved March 06, 2012, from Ebay: http://www.ebay.com/
Ebay. (2012). Register with eBay. Retrieved March 05, 2012, from Ebay:
https://scgi.ebay.com/ws/eBayISAPI.dll?RegisterEnterInfo
Eservglobal. (n.d.). E commerce Models. Retrieved March 03, 2012, from Eservglobal:
http://www.eservglobal.com/uploads/files/index.pdf
Haveeru. (2012). Homepage. Retrieved March 05, 2012, from Haveeru Online:
http://www.haveeru.com.mv/dhivehi/
Mountain Media. (n.d.). Online Payments. Retrieved March 05, 2012, from Mountain Media:
https://secure.web-payment-software.com/mountainmedia/payment/
Sun. (2012). Home Page. Retrieved March 06, 2012, from Sun.mv: http://www.sun.mv/