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COSC 648
Sungchul Hong
Case 1
1. Dell displays all its product information over the Internet. Customers are able to identify all options available for a personal computer they want to purchase. Dell also shares demand and inventory information on-line with its suppliers.
Case 2
Solectron, a contract manufacturer, collaborates with PC companies on product design.
Case 3
eBay allows people to auction products over the Internet.
Case 4
Exchanges like Freemarkets.com allow companies to auction their products and services over the Internet and seek bids from potential suppliers.
B2C
A business-to-consumer (B2C) e-business involves transactions between a company and a consumer.
eBay, various Internet shopping malls
B2B
A business-to-business (B2B) e-business involves transactions between two companies. W. W. Grainger and McMaster-Carr selling maintenance, repair, and operations (MRO) supplies to other companies over the Internet. i2, Ariba, Commerce One, and Greemarket.com; these companies set up Internet exchanges and auction sites for manufacturers dealing with suppliers.
On-line Retailing
The Boston Consulting Group estimated that on-line retailer transactions exceeded $36 billion in 1999. (2% of total retail sales across all channels)
B2B Example
Companies like W. W. Grainger, Cisco Systems Inc., and Intel Corporation were the first to move many supply chain processes on-line. Companies like General Motors are setting up e-business to handle procurement of everything from staples to steering wheels.
B2B Example
At General Electric, employees order office supplies from pre-qualified vendors over the Internet. Ford Motor Co. is using the Internet to bring together engineers from its operations all over the world to collaborate on projects with a goal of designing basic components that can be used everywhere.
B2B Business
E-business is expected to provide significant payoff in most B2B supply chains. Speculation abounds that e-business will lead to reduced prices, higher productivity, and lower labor costs.
Setting Up an E-business
If a firm is to exploit the advantages of setting up an e-business fully, it must understand the key differences between using the Internet and other channels for the flow of information, products, and funds.
Offering direct sales to customers Providing 24-hour access from any location Aggregating information from various sources Providing personalization and customization of information Speeding up time to market Implementing flexible pricing allowing price and service discrimination facilitating efficient funds transfer
An e-business can significantly lower its inventories if it can postpone the introduction of variety until after the customer order is received.