Supply Chain Paper

Supply Chain Paper

The internet environment has created many opportunities for businesses to expand their markets, reduce costs, improve efficiency, increase customer satisfaction and help partnership with others who are part of the supply chain. Companies must become experts in e-commerce today in order to take advantage of the opportunities and compete in a global economy. Business-to-Consumer (B2C) and Business-to-Business (B2B) commerce are the exchanges companies use to stay competitive. These exchanges are unique in their function and create distinct supply chain site differences. This paper will discuss B2C and B2B commerce and how the supply chain differs on a B2C site compared to a B2B site.

B2C sites are internet based market places. E-business portals link customers to suppliers with the objective of passing goods and services to the end user. B2C sites use three venues to entice prospects to become customers. The first venue is the auction store, the second venue is the on-line store, and the third is on-line services. The internet auction store, like eBay has many advantages such as convenience, increased reach to a global market, and because this is a virtual market no infrastructure is needed, so the cost of doing business is reduced. The disadvantages are that the bidder is left vulnerable to possible fraud because the bidder must trust the seller to transfer the goods, and not being able to see the merchandise upfront is another disadvantage. The physical product is only viewed through pictures and descriptions that may not reveal the actual condition and quality of the merchandise. The second venue, online store, benefits the company by increasing demand, low-cost global reach, cost reduction, and overall reduction in costs. The third venue, on-line services is using the exchange to provide customer service, or as a tool to enable the creation of services that can help to make life easier. On-line services seek to leverage the power of the internet. Advantages to the consumer are lower prices, wider choice selection, better quality information, and convenience.

Capabilities of the B2C exchange are real-time, instant communication among participants in the supply chain; global access into new markets on a larger scale; because of the immediate exchange of communication the ability to customize the merchandize to the need of the customer possibilities is increased; purchase availability is offered around the clock. The functionalities of the B2C site are that de-intermediation is an option and consolidation and convergence take place to facilitate a large market ad it is easier to place orders and to fulfill them.

Before the B2C site becomes a reality organizational change must begin. Employees may resist the change to convert to virtual marketing. Transitioning from a traditional store to an e-market cannot become successful unless B2C sites' businesses redesign existing processes and streamline to suit new ways of doing business. B2C sites must integrate business systems with partners in the supply chain and then match compatible technology to the business needs in order to get the most out of the exchange.

The supply chain differs in a B2C site from a B2B site in the following ways. The B2C site must appeal to the prospective purchaser but it is the actual purchasing of the items that determine whether the site is a success or not. For example Travelocity.com may have an appealing site but if the prices are not as competitive as those found on Expedia .com then the site does not successfully accomplish the final objective - ticket sales to the mass. This is different from a B2B because competition does not take place in that same way. Once the goal sales are pursued a B2C site must build customer loyalty in order to sustain. The ability to personalize and develop applications that are user-friendly brings customers back to repeat the pleasant experience. Businesses like Dell have developed this reputation and coupled with a best in class product the company is going to be around for a long time. The B2C site must also increase focus on investing in the supply chain technologies so that there is an increase in fulfillment of customer orders. B2C supply chain reaches endless customers who prospect the sites in a way that B2B exchanges do not.

B2B exchanges operate through supply chain management. On-line portals act as conduits to allow orders, invoicing and payments through out the supply chain. Wholesalers, distributors, manufacturers all do business electronically through the Business-to-Business sites. B2B sites buy and sell information via the internet through private networks shared among the partners. E-markets host supply chain applications and support collaboration among industries