E-commerce for the Enterprise - Essay Example

23 December 2008 E-commerce for The Enterprise Introduction Technological advancements have ushered unique and diverse opportunities for retailers. The internet technology for one brought about e-commerce which allows business organizations to complement their brick and mortar operations with online capabilities or solely build presence in the marketplace through their own websites (Strategic Management 2000). After its eight successful years in the market, The Enterprise will go after the footstep of those who got big by utilizing the internet technology in integrating its outlets all over Europe and will further go global through this strategy. In this report, The Enterprise is proposed to establish a website where it harnesses the full power and possibilities of e-commerce in order to become more successful in its operation. Thus, the website will have features which will enable it to address the weaknesses in its daily operations, enhance its processes, and pursue its long-term goals. Website Features and their Advantages 1. Intranet Currently, The Enterprise has twenty outlets all over United Kingdom which operates the same system but lack the integration needed by retailing operations. Thus, the first issue which should be addressed by the business organization is the integration of its outlets through the use of internet technology. Thus, the website will feature an intranet which allows staff to log-on, access, and use information which is specific to the business organization (De Wit and Meyer 2002). In the e-commerce technology proposed, each outlet will be linked together through an intranet which will be shared by the entire business organization. Through this intranet, communication among staff will be facilitated (Duyne et al 2003). Discussions on promotional activities like sales and discounts will be organized through this intranet. Also, recording of sales and other administrative matters will be rationalized by providing a single template which will be used by each of the outlet. Calendars will also be shared and the database of sales for a particular period will also be made available for decision makers. This intranet will allow The Enterprise to immediately and conveniently compare performance, tailor strategies specific to each store, and retrieve important information in each store(Duyne et al 2003). Because of these functions and features, the intranet is expected to cut administrative cost and paper works done by the headquarters. 2. Business to Business Capabilities The integration of the business organization should allow the company to carry out functions which will enable them to reap economies of scale. Acting as an integrated unit, the retailer can gain advantages in unifying its ordering and delivery processes. In its move of harnessing the full power of e-commerce, business to business model should also be adopted. The Entreprise website then should allow other players in its value chain to take a more active part in the company's operations (Kotler 2005). Included here are its various suppliers and logistics partners. In the current setting, each of the retail outlets of The Enterprise conducts their separate ordering and logistics functions with the supplier that they prefer. The ordering system is manual and each outlet reaches an average of three days for placing orders, receiving, verifying, and replenishment of stocks (Kotler and Armstrong 2002). Being in the retailing industry, the availability of products in each of the outlet is a very important concern. Stock-out costs are costs associated with a retailer which runs out of stock when a customer intends to purchase them. These costs are not only seen to be in terms of the foregone opportunity to sell to the buyer but also in their loyalty and the image that the retailer will have to a customer. Thus, relationship with suppliers will be an integral part of the e-commerce system which will be installed. In order to save a significant amount of cost, The Enterprise should integrate its ordering and logistics processes. An integrated ordering among all the outlets will be beneficial because it will also strengthen the bargaining power of The Enterprise to its suppliers. As more product purchases are made, the company is seen to be better positioned in asking for discounts and other favors from the supplier (Kotler 2005). Quality is also ensured to be the same in all of each stores as a single supplier is providing the goods that they sell. The website of The Enterprise then is proposed to have a function where suppliers can log-on and look at the inventory needs of the companies. The Enterprise will always be on the lookout for the suppliers which charge the lowest cost and the highest quality in products. Thus, their proposals and bids could be submitted in the company's online system. The company's staff and the suppliers can also communicate using the website. The supplier can also look and check the level of inventory using the log-on details which will be provided by The Enterprise. However, this feature will only be available for current suppliers who are prompted whenever inventory level drops at a certain level and replenishment is automatically required by the system. This feature then calls for the installment of a POS system which will put in all of the outlets' checkout counters. The use of POS will not only be to track the sales of its outlets but also manage the level of inventory and automatically alert suppliers if the quantity of the good is below the equilibrium quantity preset by each outlet. This system will save huge cost for the company as it will eliminate the time, financial resource, and paperwork required when a manual ordering system is in place (Kotler 2002). After receiving the alarm or order, the supplier can then respond by confirming that replenishment will be done in a few hours in each of the outlet where supplies are needed. This system will benefit the supplier by its ability to build a good partnership with The Enterprise. 3. The Enterprise to Customers With its aim of boosting its sales trend and serve a larger clientele, the website of the The Enterprise will also be used in order to connect and directly interact with its various customers. The company's website will be organized in order to be user-friendly. It will be equipped with capabilities which will allow customers to browse products and buy them online. The company's website will also be an online store which will feature the products which are currently available in each of the retail outlets as well as those which are in its warehouses. For customers, the first feature which will be installed is the access to the list of products that the company offers. Products will be categorized according to different variables that would help the buyer in making a good buying decision. Search functions would be beneficial for buyers to filter his searches according to an expression and categorical variable. For instance, the products could be listed according to price range in order to better suit a buyer's budget. Another search filter will be the features, size, color, and the stores where the items are available (Duyne et al 2003). Through these features searching products in The Enterprise's website will be as manageable and convenient as possible. The online store will also allow buyer to compare product features along the same categories. This will be installed in order to make the shopping experience as beneficial to the customer as possible. The online store of The Enterprise will allow purchase of products and services through online means such as Paypal and egold together with debit and credit cards. With this, The Enterprise should invest in security software which will ensure companies that all the financial and purchase transactions undertaken in its website are safe and will not endanger the customer. Before the customer finally pays for the purchases that he made in the online store, a virtual checkout counter will also be in place. In here, the customer reviews the products which are in his shopping cart. He can have the option to return some of the products or add some more. He can also modify the quantity; check the charges for shipping and gift wrapping, together with the taxes for purchase. The check-out counter will be a place where he finally confirms the transaction which is about to take place. In order for customers to feel safe about their purchases, online tracking will also be a feature which will be included. From the warehouse or each store outlet, the customer would be able to know what actions are taken after his purchase. For each orders placed and paid for, a tracking number will be provided which the customer can enter in the order tracking system in order to know the progress of his purchase (Kotler 2002). The online store is supportive to the strategy of The Enterprise to become a global business organization. Operating a virtual store allows the company to reach out to the global market wherever internet access is available. The internet technology through the website can connect The Enterprise to all customers worldwide without the political and geographical barrier (Kotler 2005). The online store can be a way to introduce the retailer in new countries where its products are not yet available. It is also a way that former shoppers of its stores who are now residing outside the United Kingdom can avail of the products that it offers. The development of global logistics will facilitate the fast delivery of its product to any part of the globe. The customers' capability of paying through online further facilitates the possibility of these global transactions. The online store is also in line with the goal of the company of evolving and reinventing itself in order to offer the best shopping experience for its customers. With the increase in internet literacy, the company is poised to take advantage of the rapid rise of purchases made using online stores. Customers are provided the venue of making purchases in the comfort of their own homes with just a mouse-click. The online store will also allow customers to shop online and be able to pick-up the purchased items in the retail outlet nearest to the customer or have them delivered straight to their doorsteps. Customization will also be most possible through the direct purchase of a buyer. The online store will also allow The Enterprise to gain more information about its market, behavior of individual customers, and the appropriate strategies which will be most efficient in order to build an efficient relationship with each of them. It should be noted that before a customer undertakes a purchase transaction, he will be prompted to enter his personal details including his age, email address, and other demographic factors. This wealth of information could be used by the company in order to know the preference of its different market together with the timing and amount of his purchases. Using market research techniques, the company can then come up with strategies to conduct marketing campaigns which are most likely to appeal to each individual buyer (Kotler and Armstrong 2002). Impact and Challenges Presented by Going Online Amidst the numerous advantages posted by the use of e-commerce in the operation of The Enterprise, it is also irrefutable that the use of internet technology exposes it to a lot of possible risks, challenges, and even problems. The establishment of an online store is seen as the company's way of marketing new products and could raise and enhance consumer awareness of the business organization and the product. Because of this, the company could expect that sales of its outlets to possibly increase if these new consumers who become aware of its products visits its stores and purchase from them. However, in most cases, when online shopping is made available, outlets suffer as customers prefer to have hassle-free shopping within the virtual stores. The decline in shoppers visiting retail outlets will be a challenge for a company. Thus, the establishment of a marketing technique to balance to sales made in online store and the outlets should be considered by The Enterprise (Coppel 2003). Another risk that the company faces is the possibility of downtime which can affect its operations. As it is now operating through a more technologically intensive facility, it is exposed to possible technical difficulties which can happen anytime. There are also risks in having its website hacked that could cause the leakage of information which are intended only for its staff or customers. This instance could sabotage the whole operation of the company. It should be noted that in cases where company's online stores are hacked and consumer information are taken, business organizations involve pay through legal liabilities but also through the bad reputation and image that it has in its market (Coppel 2003). Thus, it is important to take note of these considerations in the operation of a virtual website. The decision of The Enterprise to adopt e-commerce is very helpful in making it a more efficient business organization in promoting the efficiency of its internal communication, relationship with supplier, and facilitating online transaction with its customers. In addition, this strategy also allows the company to broaden its market through reaching to a wider global market. However as with any other decisions, going online should also entail the company to invest in many resources which altogether will enable it to operate the new system in full efficiency. Tight security measure should be in place in order to ensure that leakage of information to and from the system to parties outside the company is avoided. Also, periodical maintenance measures in order to maintain the performance of the website and other technologies facilitating it should be regularly conducted. As much as possible, The Enterprise should also install counteractive measures in order to ensure that everything is running smoothly. Works Cited Coppel, Jonathan. "E-commerce: Impacts and Policy Changes." 2003. OECD Economics Department Series Duyne, Douglas, Landay, James, and Jason Hong. "The Design of Sites: Patterns , Principles, and Process for Crafting a Customer Centered Web Experience." 2002. Addison-Wesley Professional: New York De Witt, B. and Meyer, R. 1998, Strategy: Process, Content, Context, 2nd ed., International Thompson Business Press, Oxford Kotler, P 2002, Marketing Management, Prentice Hall, New Jersey Kotler, P. and Armstrong, G 2001, Principles of Marketing, Pearson Education, Inc., New Jersey Strategic Management, Strategic Management Journal, Vol. 11 pp.171-195 Read More