Implications of E-commerce for Fresh &Go Ltd - Case Study Example

CASE STUDY - FRESH &GO LTD By Name Course Instructor Institution City/State Date Case Study - Fresh &Go Ltd Introduction E-commerce can be defined as buying as well as selling of goods/services, or transmission of data or funds, through the Internet or other electronic networks. Such business transactions take place through different models such as consumer-to-business (C2B), business-to-consumer (B2C), business-to-business (B2B) or consumer-to-consumer (C2C). E-commerce has successfully changed the methods of business thanks to its flexibility, ubiquity, cost-effectiveness and agility. These days, internet has turned out to become an instrument for achieving competitive advantage. Moreover, the information and communication technology (ICT) together with its applications has resulted in major changes in cultural, social and economic processes, while the traditional procedures have been obliterated entirely and substituted by virtual methods (Zareii & Gilaninia, 2015, p.2). The paper seeks to provide evidence how E-Commerce adoption will help Fresh & Go with its future expansion plans and discusses the types of Information Systems that should be considered by the company so as to implement a successful E-Commerce solution. Implications of E-commerce for Fresh & Go The internet will provide Fresh & Go a window to the world, whereby consumers will be able to access different types of goods at lower prices as compared to the local store. The internet reduces the cost of search, and it has become easier to make online purchase. E-commerce transactions normally have reference numbers; therefore, the customers get the products in a complete and accurate manner. Therefore, by enforcing appropriate integrity mechanisms, Fresh & Go can experience fewer errors. As mentioned by Ma’aruf and Abdulkadir (2012, p.3071), E-commerce results in improved and more efficient communication between the company and the customers. Moreover, E-commerce is convenient because it allows customers to shop anywhere at any time. E-commerce is preferred by scores of customers because of its convenience and cost effectiveness. Shopping physically is time consuming and costly; therefore, many people prefer online shopping over brick-and-mortar store. Furthermore, E-commerce has high efficiency, and their start-up costs are far less as compared to expanding the brick-and-mortar store into other locations. The number of permits and licenses needed by a company to start an online business is fewer as compared to those required for brick-and-mortar stores. Moreover, only a few employees are required to perform operations like billing customers and inventory management. E-commerce can help Fresh & Go reduce inventory costs after espousing the just-in-time (JIT) system; thus, improving the ability of the firm to accurately forecast demand. However, adoption of E-commerce comes with numerous shortcomings; for instance, poor implementation of E-commerce can result in poor system standards, reliability or security. Besides that, the cost of developing E-commerce application is very costly. In addition, the targeted customers may refuse to trust the new developed site; thus, making it hard for the users to change from the physical stores to online stores. Ensuring privacy or security on online transactions is very challenging. As stated by Niranjanamurthy et al. (2013, p.2362), mechanical failures of E-commerce systems can result in volatile effects, which can negatively affect interactions between customers and the company. The increasing number of cyber-attacks leaves the E-commerce systems vulnerable to attack. Despite the above mentioned disadvantages, a number of companies have succeeded in E-commerce. For instance, eBay, Inc. is a well-known marketplace on the Internet that allows users to sell and buy nearly everything. The company was established in 1995, and currently has over 162 million users and through PayPal, which is eBay’s online payment service, people can make transactions almost everywhere in the world. Flipkart.com is an E-commerce company established in 2007, and focuses on e-books, air conditioners, electronic goods, stationery supplies, air coolers as well as life style products (Nigam et al., 2015, p.333). The company allows different payment techniques like debit or credit card transactions, cash on delivery, e-gift voucher, net banking, and so forth. Currently, Flipkart is the biggest online retailers in India delivering almost 5 million shipments every month. Amazon.com, initially was an online bookstore, but currently is the biggest ecommerce business in the world selling different types of products such as video games, software, DVDs, electronics, Jewelry, and so forth. These are some of examples showing how ecommerce is making scores of businesses successful. In view of this, E-commerce will enable Fresh & Go improve productivity and efficiency and also removes the physical boundaries that could deter the company from becoming successful. Some of the benefits that Fresh & Go would experience upon adopting E-commerce include market expansion, improved efficiency, reduced uncertainty, and high efficiency in the distribution channels. Imperatively, e-commerce is cost effective and cannot be compared to the conventional commerce technique. E-commerce does not need third parties such as sales person; therefore they cut costs. In e-commerce, the total expenditures required by Fresh & Go to run its businesses will considerably be less than the current commerce method. In e-commerce business, the company will just need a head office and no branches while the cost for office rental, maintenance, and communications and will be replaced by e-commerce business’s web hosting, which is a single cost. Additionally, e-commerce will offer Fresh & Go an improved connectivity for its customer given that the company’s website would be virtually accessed from anywhere by means of the Internet. In this regard, the company can get in touch with many customers; thus, leading to the elimination of geographical location limits. For both Fresh & Go and its consumers, e-commerce will be more convenient because online transaction has less red tape than physical stores. Utilisation of e-commerce can help Fresh & Go reduce the time needed to generate, transfer as well as process a business transaction. Additionally, problems such as human errors, records’ duplications are largely reduced because the process of data-entry and re-entry are reduced. The accuracy and speed improvement in addition to improved information access, will lead to improved productivity at Fresh & Go. Types of IS for Fresh & Go The best e-commerce model for Fresh & Go is the business-to- consumer (B2C) model, whereby the transactions are made directly between the company as well as the end-users. Even though there are a few online B2C websites, companies like Priceline.com as well as Amazon.com have existed for many years and are considered to be the world’s most successful companies. A causal IS success model was proposed by Delone and McLean (1992), which factored success as a combination of organizational and individual impact, information quality, system quality in addition to user satisfaction (Balasubramanian et al., 2014, p.3). According to Delone and McLean (1992) model, the information quality and system quality have an effect on the user satisfaction. Balasubramanian et al. (2014, p. 4) assert that in the E-commerce setting, service quality exhibits the organizational support offered to the end-users afore, during, and following the exchange cycle. Essentially, there are different types of information systems (IS) such as Transaction processing systems (TPS), Knowledge management system (KMS), Executive support systems (ESS), Decision-support systems (DSS), and Management Information System (MIS); however not all of these information systems can result in successful e-commerce model. Information Systems that Fresh & Go should consider to implement a successful E-Commerce solution include the Decision Support System (DSS), which is a computer application that seeks to improve the ability of the user to make decisions. The system is designed so as to enable decision makers to use communications technology, knowledge and data so as to identify issues and solve them. Citing a number of studies, Velmurugan and Narayanasamy (2008, p.157) identified a number of DSS levels in E-commerce sites: relationship focused, transaction focused, and access focused. In this case, access focussed websites provide simple access to user-pulled information, like the basic browsing and search capabilities; the transaction focused websites interactively provide more support for the mental processes of the buyer, such as offering templates and default settings, well-structured steps and guided choices; the relationship focused websites concentrate on sustaining long-standing relationship with the customers. By integrating user-friendly software, data as well as complex analytical models, DSS as mentioned by Patel and Patel (2006, p.516) can create alternatives for both problems (both unstructured and semi-structured). In addition, DSS provides numerous alternatives through which user can choose one of the alternatives based on his/her requirement satisfaction and convenience. Therefore, the main purpose of DSS based E-Commerce paradigm is to enable the customer to buy goods from the Web stores. This paradigm can help Fresh & Go simplify how it presents its products. The paradigm can help Fresh & Go to keep it simple while offering the customer’s the sought after information. another IS that Fresh & Go should consider to adopt is the Management Information Systems (MIS), which focuses on collecting, processing, grouping, amassing and distributing information so as to support control and decision making. Imperatively, MIS offers information pertaining to the business real economic value (Singh & Kaur, 2012, p.5). The MIS objective is changing data into information to enable the business owners to easily utilize the generated information to make important decisions about business projects. MIS will bring data sharing functionality at Fresh & Go. Basically, MIS data can be shared between users who are authorized; this, enabling users to access data efficiently. A number of users can have access to the same data, and more new data can be added easily to the old date; thus, resulting in a combined result, which can be accessed easily. In the E-commerce websites, MIS results in the accuracy and consistency of the data. There is no room for error because MIS detects different forms of errors, while the data is being fed to the system. Still, developing a new management information system will be challenging for Fresh & Go because of the cost factor and other problems such as the need for updated information system. In addition, Fresh & Go will have to update its employees concerning the changes in the company’s websites. Another important IS that Fresh & Go should consider is knowledge management systems (KMS), which are concerned with dissecting and organising knowledge and subsequently sharing or redistributing it with members of the organization. KMS main objective is to improve performance, bring ideas and innovation, promote integration as well as improve knowledge retention in the organization. Harvesting knowledge is every important for businesses operating virtually; therefore, KMS information systems act as the main source of knowledge. Such systems are beneficial because they help organisations maintain consistency and also allow fast responses to inquiries made by the customers. With enhanced KMS, e-commerce firms can easily expand their businesses as evidenced by the Grommet, which is platform for launching new products. To make products successful after the launch, the Grommet depends on engaged customers to validate the products included in the online catalogues. In the market space of e-commerce, the amounts of accumulated data are very large; therefore, finding knowledge from such large amounts of data manually is impossible. Therefore, KMS is used by e-commerce businesses to discover different types of knowledge (Hong Yu et al., 2009, p.153). Without a doubt, the KMS based E-commerce model will enable Fresh & Go to experience free flow of ideas; thus, promoting innovation. Besides that, the model will improve Fresh & Go‘s customer service through restructuring of response time and the company’s revenues will increase because the products will get to the market faster. In addition, the model will streamline Fresh & Go operations and eliminate redundancies; thus, reducing costs. Conclusion In conclusion, the paper has provided evidence on how E-Commerce adoption will help Fresh & Go with its future expansion plans and has also discussed the types of Information Systems that should be considered by the company so as to implement a successful E-Commerce solution. As mentioned in the essay, the impact of e-commerce to Fresh & Go businesses can be huge, and that E-commerce can change how the company sells and delivers its products to the customers. In addition, E-commerce can transform the way through which Fresh & Go works with its partners. By e-commerce, the company will be able to reduce costs such as expanding to new locations and also reduces the needed licences and permits. Customers can purchase from anywhere at any time, and they no longer need to go to the store physically. Some of the suggested IS that Fresh & Go should consider for successful implementation of E-Commerce include, Decision Support System, Management Information Systems and knowledge management systems. References Balasubramanian, S.A., Jagannathan, V. & Jagannathan, V., 2014. Information Systems Success in the Context of Internet Banking: Scale Development. Journal of Internet Banking and Commerce, vol. 19, no. 3, pp.1-15. Hong Yu, X.H., Hu, X. & Wan, C., 2009. Knowledge Management in E-commerce: A Data Mining Perspective. 2009 International Conference on Management of e-Commerce and e-Government, vol. 109, pp.152-53. Ma’aruf, L.M. & Abdulkadir, K., 2012. An overview of e-commerce implementation in developed and developing country; A case study of United State and Nigeria. International Journal of Modern Engineering Research (IJMER), vol. 2, no. 5, pp.3068-80. Nigam, D.P., Nayak, D.K.M. & Vyas, D.P.H., 2015. E- Commerce Challenges: A Case Study of Flipkart. com Versus Amazon. in. 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