Evaluation of eBay

EVALUATION OF EBAY 1
Evaluation of eBay
Author’s Name
Institutional Affiliation
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Evaluation of eBay
Introduction
eBay is a successful e-commerce company headquartered San Jose, California US. The
company was founded in 1995 by Pierre Omidyar and operates on platforms such as
Marketplace, Classifieds, Stubhub and Corporate (Johns, 2017, p.2). The company is a multi-
dollar business with presence over thirty countries. eBay provides consumer-consumer sales via
its platform. Also, this American MNC facilitates B2C (business-to-consumer) sales via its
online platforms. Furthermore the company manages the eBay website where customers visit in
order to make purchases (Johns, 2017, p.2). eBay gets revenue mainly from the final value of
products sold by sellers and the revenue collected. The company has been able to register
growing profit since its launch. In addition eBay Company runs an affiliate program known as
eBay partner network.
Internal analysis of eBay
TWOs Matrix
Threats
Increase in competition from other online stores.
Since the industry is growing drastically and many companies coming up each time
offering customers exclusive products, eBay should come up with new strategies to remain
competitive in the business. On the other hand eBay excels over Amazon because products
which are not found in these websites can be found in eBay.
Online security

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Notably, customer’s physical address, phone numbers, details of the bank are saved
online by the company. According to Ghafir, Saleem, Hammoudeh, Faour, Prenosil, Jaf, Jabbar,
and Baker (2018, p.2) organizations with online operations are facing cybersecurity challenges
arising from hacking ,malware and other viruses. Hence, the vast information the company is
storing is vulnerable online theft.
Exchange rates
eBay operates in various countries and the exchange has a huge impacts on its profits.
The varying exchange rate is likely to affect the company and this should be treated as threat to
its operations.
Opportunities
However, despite the company having some facing threats it still has opportunities to
explore. These opportunities can help the company become the best retailer. The e-commerce
corporation has the capability and advantage of becoming the leading retailer in a few years.
Tontini (2016, p. 228) noted that e-commerce offers essential opportunities that can allow the
business to maximize profits. As stated in the introduction, eBay offers consumer-to-consumer
sales, which the company can explore to make more profits. The corporation has strong CRM
and IT systems in place to get the top position regarding sales made.
Weaknesses
High fees
The structure of fees has risen drastically over the last few years. eBay receives money on
goods , some adornment fees, listed goods and also PayPal transaction fees. Therefore, due to

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this reason sellers do not make huge profits. This is likely to affect consumers as well because
the retailers are likely to transfer the costs they incur on customers.
Growth strategies
The growth strategies of eBay are surrounded by uncertainty. It is the only online e-
commerce company which does not tell about the growth of the company. Amazingly, the
company senior manager is not sure if eBay will become a retailer in the next years or whether
they will introduce new products (Silva, Moro, Rita, and Cortez, 2018, p.312). Therefore there is
a high degree of uncertainty in the company and direction in which the company is moving to.
Strengths
The business model
eBay is the only company which acts as the link between middleman, the seller and the
buyer. According to Hui, Saeedi, Shen, and Sundaresan (2016, p.3604) the company has been
able to succeed in acting as a link with other stakeholders in the supply chain to generate
significant revenues. The authors add that automation of activities have earned the company a
good reputation that is good for business. The company has also been able to support consistency
of quality and that is why customers have confidence in the company. The sellers bid their items
in the website owned by the company where customers can access them and purchase. eBay are
pioneers in online auctioning and this has served as a strength of the company and helped the
company gain a competitive advantage over their competitors like Amazon and Flipkart.
Cash flow