Electronic business is conducting business online. Business processes that are conducted online involve buying and selling goods and services. It also involves customer service, managing production, processing payments, sharing information, collaboration with partners, managing employees, and recruiting employees among other things. The process of e-business comprises of various services and functions. Among these include developing extranets, intranets, and application of service providers for the provision of tasks and services over the internet (Beynon-Davies, 2004). Major corporations have included e-business to their business. This is because of the availability and internet, which is accessible in most parts of the world. The internet can reach a huge clientele as compared to conducting business in a region where it can only reach residents. Despite the various advantages of e-business, conducting business online may not be suitable in all instances. Customers and vendors may experience various problems in e-business such as making payments, problems with customer satisfaction, problems with supply chain management and advertisement of products.
One of the major problems experienced in e-business is making online payments. Electronic payments can take several days to complete. This is a problem especially for consumers who may be hit with overdraft fees or other extra costs due to late payments. Faster electronic payments would be more beneficial when making online payments. When payments are experienced in real time, the consumers can get access to services and products faster. Faster payments would also be beneficial to vendors too as goods can move quickly as compared to slow payments which delays transactions. Another problem experienced through online transaction is fraud. Some online systems of payments are fraudulent and this may cause a problem to the consumers and the vendors. They may use personal information used for payments to steal money from clients. When the data is not secured, the information may fall into the wrong hands causing a security risk. Another problem with online problems is lack of usability. This is because when making the payments, the websites ask for a lot of information about the users. This is a problem for many users who find the process time consuming. An example is websites, which make the process of making online payments complex through asking contact details and personal data. Making online payments is also difficult since e-cash is not accepted universally (Harris, 2016). Therefore, the establishment has to accept the payment method making it difficult for some customers. Online payments are also not trusted by most people. This results to reduced number of online purchases since customers may not trust the payments services. This may affect an online business as it scares away potential customers. Customers especially those in rural populations may not understand the process of making online payments. This may be a problem for an online business, which targets this population. Electronic business can also be expensive for a company. Setting up an electronic payment system for a business would require machines, set up and management costs making online payment and e-business an expensive venture.
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When dealing with e-business, customer satisfaction is another problem, which businesses and clients face. First, the process of purchasing goods on a website can be a hectic process. More so, the products may not appear as they were presented on the websites. This can be a waste of money for customers and result to reduced sales for online businesses. The customer can feel frustrated because of the vendors not keeping their promises. Customers experience dissatisfaction with businesses especially when the service or the product does not meet their expectations. Dissatisfaction results when there are issues with the product, website information on the product, lack of after sales services, inaccurate and slow delivery and privacy issues. E-business owners should keep their promises to customers on things like delivery dates and state of the product. Otherwise, customers may switch to competitors due to distrust. E-business can also be frustrating to customers because of poor customer service (Beynon-Davies, 2004). This can happen when customer’s complaints are not handled in a timely manner or when personnel of an e-business company are not trained well. Some e-businesses are also never active and available to chat with potential customers making it a tough experience for customers getting access to products and services. Rude stuff can also result to poor customer service. If potential customers get a rude response from a staff, this may be a huge issue as good customer service is important for business growth. Customers often experience dissatisfaction because of lack of an easy access to a team or business where they can ask questions. There an e-business needs to have various channels of communication to its clients. This is not limited to telephone and email contacts only. E-business should be accessible in various avenues such as online chats and social media. Customers also experience frustration when they feel their opinions are not being heard. Many e-businesses ignore customer feedback, which is an essential part of business that could actually boost business. Hidden costs and information is another issues, which causes customers dissatisfaction in business. This happens when an e-business does not inform the customer about extra costs such as delivery and taxes which they would have to pay for when purchasing a product.
E-business is also used in business-to-business transactions in supply chain management. Despite the benefits of doing business online, e-business can be difficult in business-to-business transactions. First, processing payments in business-to-business transactions can be a hectic process making cash flow management a challenge. In this kind of transaction, the person paying for the commodity wants to be in control of the disbursement while the supplier wants to hasten the process of collection of payment. When the buyer uses card payments, this may affect the supplier, as the buyer will control the time the payment will be released to the supplier. This may be a problem for the supplier as payments may be delayed thus affecting cash flow. Another problem faced in business-to-business transactions is it is hard to pay many suppliers electronically. This is because electronic payments would require an agreement for accepting electronic payment, account number and bank routing number and instructions on remittance data delivery. However, getting all this information for a number of suppliers is difficult, as it cannot be found online or in any book. Therefore, businesses would have to get the information by physically visiting the supplier. Thus, the process in supply change management is not entirely online based. The information on various suppliers has to be stored and updated regularly as most of this details change every time. Making check payments is easier for business to business transactions as the address is all that is required which can be obtained online or a company’s vendors addresses. Another difficulty in making payments for business-to-business transactions online is getting data from the supplier or buyer on purchases (Timers, 2000). It can be difficult for the businesses to get listings of paid invoices, which include explanations for amount of each invoice and short payments as well as promotional deductions and discounts. It can also be difficult to match data on remittances and receivables data from suppliers and posting it on open balances. Getting data into a readable digital system is another challenge experienced when making online payments.
Many businesses nowadays are being conducted on an online platform. Therefore, it is very difficult for a business to stand out on its own. This is because it is difficult to navigate the online marketing world. There are many changes and internet trends that may be difficult to keep up with. First, it is easy to get lost on an online platform especially when a company does not have proper social media management. Good social media management requires skilled personnel. One of the challenges that businesses face in online marketing is content and proper management of a company’s website or social media page. This is a challenge as content on social media should be interactive and interesting to capture the target audience and keep their interest. On an online platform, another challenge businesses face is competition. Due to the high number of businesses, which are online, it can be had to get noticed. For this reason, businesses should have a strong social media campaign with an active social media team to stay on top. When trying to break through the internet, another challenge companies experience is focusing on search engine rankings (Harris, 2016). Search engine rankings may generate revenue but relying solely on that may reduce revenue once the rankings go down. Competing with other online businesses can also be expensive for a company as there is lack of effective low priced solutions. This is because cost input that could give a company high ranking has increased while output is reduced. Cost of managing a social media campaign can also be high for a small business. This can be a challenge as larger competitors may have funds for online marketing. Marketing or advertising a product online does not only require a social media page or a good website. Celebrities can also have an influence on the traffic a product can receive and what people can buy. This is because celebrities set trends which many people may want to follow. Therefore, contracting a celebrity to be a brand ambassador for a product can be a good move for a business to boost sales. However, most celebrities ask for insane amounts of money to be an image for a product. If a company cannot meet the needs of that celebrity, they would have to look for cheaper marketing options, which may not be as effective. This is the reason many businesses despite having good quality products are not recognized. Advertising a product online can also be a challenge because the product is on a platform with global brands. If a business is local, its existence will be overshadowed by availability of global alternatives. This can be a major challenge for businesses that are trying to go global.
In conclusion, online businesses can be difficult to manage. This is because a lot of work is involved in the success of a business. An online business would require good information communication and technology equipment for success. The cost can be huge especially for small businesses. There are also many processes involved in e-business such as online payments, ensuring customer satisfaction, supply chain management, and marketing. These processes can result to the downfall of an online business if not managed effectively. However, management of the processes is not simple and requires capital as well as skilled personnel to perform the tasks. For the success of a business, cost input should not be more than the profits. In the case of startups and small business, initial cost of e-business may be too much making companies struggle to make ends meet.
References
Beynon-Davies P. (2004). E-Business. Palgrave, Basingstoke
Harris, M. (2015). "Book review: 'The Internet Is Not the Answer' by Andrew Keen". Washington Post.
Timers, P. (2000). Electronic Commerce - strategies & models for business-to-business trading. John Wiley & Sons, Ltd, ISBN 0-471-72029-1
