Companies could greatly benefit from the Internet as it can organize trade relationships between them. Although the Internet itself is incapable of providing those types of activities, the services that could be provided through the Internet can assist the methods in which business is conducted.
There are seven principle activities exercised between companies, and e-commerce aims to activate and design them with consistent precision and adequacy.
Contemplation
All companies look into the innovation process in one way or another and often refer to other companies for evaluating the nature of the work it practices in order re-determine and re-design the scope of its activities. This process usually relies on a wealth of information that could be accessed through excavating libraries and researching databases.
Design
Companies have to either design a service (e.g. Auditing) or work on engineering their products. They may revert to designing via Computer Aided Design (CAD) to achieve high quality results.
Advertising/ Attracting Clients
All companies need to find the appropriate methods to attract clients and suppliers. This is usually done through advertising in magazines, newspapers, TV and radio.
Evaluation
The company has to evaluate a potential partner to determine the financial capacity of that partner. There are companies specialized for those types of services. A buyer should be convinced that the supplier can provide the services and/or products in the required quantities, in good quality and at the set time. Confidence often relies on the general reputation of a company.
Evaluation can be considered as a critical task to the extent that buyers when finding the appropriate supplier are reluctant to look for another one.
Demand
Companies need effective and reliable mechanisms to issue manage and follow up on requests. Usually companies rely on the traditional methods for exchanging information such as postal services, phone and other means.
Delivery
Companies require a mean to deliver goods to the buyer either through retail outlets, transport companies or via an electronic medium.
Payment and Settlements
The most important phase in trade transactions is the payment and settlement phase. This phase is carried out by banks through financial settlement schemes.
Role of the Internet
Contemplation
There are many companies providing limitless services that could provide information on the Internet to whoever requires it. The Internet contains a huge amount of databases, ranging from the US Congress to research centers and colleges that can be obtained either for free or for a simple fee. Today the Internet is the ultimate option for parties wanting to spread their information to the public.
Design
A substantial amount of consulting, design and marketing services as well as software development programs are available on the Internet; their numbers are expected to increase dramatically in upcoming years.
Advertising/ Attracting Clients
One of the important challenges of the Internet is finding out the most demanded information and services. There is a large amount of Service Guides to solve this problem. This service provides information in the format of categories and classes and secures a direct link with companies and other concerned parties, through usage of the World Wide Web where databases could be accessed. Service Guides provide for a very efficient means for advertising and promotional activities.
Evaluation
This important task consists of two aspects; financial and technical. A client has to be ensured of the financial stability of a company and whether it has the technical capacity to provide the required service or good. It is now possible to carry out a financial evaluation electronically to a certain extent, however, uncertainty on some standards still remain.
Demand
The dissemination of EDI has helped boost the fame of companies. EDI is considered to be the first phase of e-commerce, where the spread of the Internet has opened way to the set up of means to exchange information available to all that are uncomplicated technically and at a very low price.
Delivery
The Internet is considered to be the ideal medium to deliver goods and services electronically. E-services and goods have become more and more popular leading some companies to refer to online translators where texts are exchanged by email. Through email, databases could be transferred in blinding speed, regardless of the number of pages it contains.
Payments and Settlements
It is now possible to make payments and settlements through secure electronic channels available on the Internet.
There are some companies that apply programs for the purpose of building confidence between buyers and sellers, although those are in need of further development.