Beckom Company's E-commerce Strategy and Profitability Report

This report examines the profitability of incorporating e-commerce into a business, using Beckom Company as a case study. It begins by exploring the general advantages of e-commerce, including its impact on market reach, sales, and customer engagement. The report delves into the financial benefits, such as increased profit margins and cost reduction through automation. It then outlines a migration plan for Beckom Company, detailing the steps involved in setting up an e-commerce website, marketing strategies, and customer acquisition techniques. The report also discusses the positive and negative impacts of e-commerce on an organization, including convenience, cost savings, and potential challenges like security issues and customer trust. The analysis highlights how e-commerce can enhance communication, provide valuable data insights, and facilitate global sales, ultimately concluding that the benefits of e-commerce outweigh the limitations for businesses seeking growth and profitability. This document is a valuable resource for understanding the transition to e-commerce and its implications.

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HOW IS E-COMMERCE PROFITABLE?
E-commerce is one of the technologies that is trending in the market today. E-commerce is also
referred to as electronic commerce. Most businesses have ignored e-commerce (eCommerce,
2013), but they don’t know what there are missing out. Many existing business still have no idea
the power of incorporating e-commerce in their businesses. This question has been researched by
most businesses over the internet. Most people don’t really understand what e-commerce is.
Simply, e-commerce refers to making successful transaction over the internet. This means,
businesses display their products and services on a website and potential customer will view the
products, buy the products and pay for the services. When people buy and sell products and
services online then, they are involved in e-commerce.
Most businesses need to make profit in their business.
Making profit is a goal for all business in the world. People with companies that do not return
profit tend to shut down their business. There advising people to migrate their business to e-
business then the question they tend to ask is “how is e-commerce profitable”(The Balance Small
Business, 2018). This question is an important question. The question makes the company lay
out a plan before switching to e-commerce. The question has been asked by many people and
most blogs have given a solution as to how e-commerce is profitable. There are many reason
displayed on the internet on how e-commerce is profitable. E-commerce is profitable. This is the
reason there are so many new e-commerce stores. E-commerce involves three main business
areas. They include developing an e-commerce website, marketing and reliable customer
support.
E-commerce is very interesting technology. Research has been done on the online site available.
Questionnaires and observation methods have been used to get the statistics of e-commerce
businesses all over the world. From the research done, most companies prefer e-commerce due to
the increase of the profit margin. There is also a minor percentage of around 20 percent that is
against e-commerce. Most of these people are the retailer. Most retailers don’t need to make their
sales online. Some retailers argue that the income that can be generated by using e-commerce has
no difference compared to making their transactions in the traditional way. About 76 percent

INCORPORATING E-COMMERCE IN BUSINESS
shoppers (Shmueli, 2008), do their shopping on online platforms. This means that 26 percent do
their shopping using the traditional ways. The shoppers mostly do their shopping from Amazon.
Another research is that most of those people who use e-commerce to buy products and services
have a higher salary compared to those who use the traditional way. The online shoppers have
income of $100,000 or more, while, the traditional shoppers have an income of $30,000 or less
(Parks, 2018). The people with higher income have a tendency of buying more goods online,
thus, the online business earning more profit. The traditional shoppers tend to buy few goods,
therefore, the profit margin for the businesses is a bit low. Research shows that e-commerce
business will be the ones left.
To know whether e-commerce is profitable is for the organization’s advantage. As mentioned
before, the business goal is to make profit. One of the main method to make big profit margins is
via e-commerce. Using e-commerce a company can reach a wider market. E-commerce offers a
platform to make more sales via the website. Small business are expanding as a result of
incorporating e-commerce in their businesses. The e-commerce has allowed the categories of e-
commerce to be successful (Inc.com, 2018). The categories include: B2B, C2B, C2C and B2C
(Eley and Tilley, 2009). E-commerce has laid out strategies that help business thrive. The
payment solutions, supply management solutions, online auctions and wireless technology help
the small businesses to grow, the small business tap into inventory and sell the products without
taking ownership of inventory. The organization only requires to focus on digital media for
advertising purpose. Upon using e-commerce, much data is collected in the system. This data is
quite helpful for the business. An organization requires to add the analytic tools. The analytic
tools such as Google Analytic is quite helpful. From the analyses data, the organization can tell
the number of visitor that visit the website. The analytic tool makes very vital information,
which, is used by the organization board to make the right decision. E-commerce has very many
benefits to a business. Most business should switch to e-commerce.

INCORPORATING E-COMMERCE IN BUSINESS
2. REPORT
Introduction
Beckom Company is a medium sized company that deals with supplying of electronic devices to
various companies. The company was founded by Roberts Steven in 1988. The company has
been operating for 20 years now. The core purpose of Beckom Company is providing electronic
devices such as printers, laptops, scanners, internet cables, scanners, printers, photocopiers and
other devices (Andrea Payaro and Anna Rita Papa, 2017). The company has really struggled to
survive in the market by providing its product to the local customers and business. In 1999 the
company opened 3 more branches in different locations a there was more need for the products
in the areas. The branches of Beckom Company are in the major town in the country. The
company has been using the traditional ways to make the sales and do the analysis of the sales
(Prinz, 2012). The company has not yet incorporated the e-business feature in the business
process. Over time the company has had not much profit margin, but has had less profit margin
just to maintain itself.
Over time, the business has been performing poorly much many other similar companies are
taking over(Datta, 2010). The company has suffered several challenges such as poor customer
communication, poor communication with the employees from different branches, poor
management services, poor decision making, losses and increased competition (Sun and Hu,
2014) from outside, thus making fewer sales of their products. The effects are immense as they
have led to financial losses, losing the customer loyalty and the issues are getting out of control
(US consumers wary of password security for eCommerce; smartcards to give peace of mind?,
2008). The business is at a risk and is nearly closing due to the financial loses made within the
past three years(Musa S, Norwawi and Selamat, 2012).
After some consultation from a consultation firm, the founder was advised to incorporate e-
commerce in the business as that is the trend of successful businesses. The e-commerce is to help
solve the communication barriers been the company and the employees, the management and the
employees and employee to employee. By use of the e-commerce Beckom would be in a position
to reach more customer globally and problem get to open more branches. Access to more
customers leads to more sales and thereby, generating a great profit margin. Over the past 10
years e-commerce has had a fast growth. Most businesses have switched their business to e-

INCORPORATING E-COMMERCE IN BUSINESS
business (Medium, 2018). E-business has enabled various organizations make greater profit
margins. Beckom Company would be in a better position if they had incorporated the e-
commerce into their business processes.
Migration plan
There are a number of requirements that are needed to switch to e-commerce business (Rea,
2012). The requirements include: choosing an e-commerce niche, research on the business
models, product selection, establishment of a brand, building an e-commerce website and
marketing to get more customers. For the case of Beckom Company, the first four step are
already laid out. The remaining steps that should be looked into include developing an e-
commerce website, marketing the products online and attracting more customers to the e-
commerce store.
Since the business is already registered, the company needs to plan for the website development
(Building eCommerce applications, 2011). The design that is to be used should look appealing
and beautiful. The user interface should be simple and beautiful. The feature to consider include:
loading speed, compatibility with other devices in mobile and laptop. The design should also be
compatible with any device. The website should also implement the Search Engine Optimization
(SEO). On deciding the design of the website, the company should use a theme that is
compatible with the website requirement. Beckom Company has to find way of attracting more
customers to the site. Customers are so important to any business. To attract more customers, the
website should involve the SEO functionalities. The company could also pay for ads to advertise
the company online. To attract more customers, the photography in the website should be
appealing. Finally, the company should make and effort in adverting the company online. The
adverts could be through social media such as Face Book, You Tube, and Twitter etc. The
adverts will increase the traffic in the website. An increase in the number of visitor in the site,
results to greater number of sales (Tuten, 2010). The highlighted plan must be followed for a
successful e-commerce business.
Impacts on the organization

INCORPORATING E-COMMERCE IN BUSINESS
E-commerce has both positive and negative impact to the organization. There are multiple
implications from e-commerce. The positive impacts include: convenience, time saving,
information availability, price comparison, new business, the business can run all day and night,
increasing the global market, new market models, online advertising, cost of labor, boost brand
awareness, offers much data and expand market niche for products.
E-commerce allows people to buy goods from any place and at any time of the day. These
creates convenience of the customers buying the products any time. In return to the organization,
the company will get more customers buying the goods (Enterprise 2.0: how technology,
ecommerce, and Web 2.0 are transforming business virtually: v.1: The strategic enterprise; v.2:
The behavioral enterprise, 2010). Using e-commerce attracts more customers using the search
engine. Some customers may not be having the link of the website. On a random search of the
products they require the link of the Beckom Company may appear if Search Engine
Optimization is implement on the website. Another benefit is that, Beckom will be in a position
to decrease the cost of inventory management. The cost of inventory management is decreased as
the web management system can automate the inventory management (Unctad.org, 2018).
Also, the organization is in a position to view the consumers’ buying behavior. The e-commerce
has analytic tools such as Google Analytic that can help the organization interpret the e-
commerce data. The analytic tool can tell the number of visitors in the website and give details
on which pages the customer visited (Gaol, 2012). The analytic tools are powerful as they also
give much analyzed data that helped the management team to make the appropriate decisions for
the company. E-commerce allows the organization to make sales all over the world. The
customers are just required to pay the cost of the products and the shipping amount and the
product can be delivered at the door step of the consumer.
The use e-commerce enhances the communication between the company and the customer
through live chat link. In case of any query on the site the customer can ask a question from the
website using the live chat function. If the customer receives a quick response, then the customer
builds trust for the organization. Clients are always appreciate the quick response. With effective
communication, most customers tend to stick to the organization while buying the products.
The e-commerce has a few limitations. The limitations include: unemployment, uncertainty,
security issues and customer trust. Due to the automation of most process in the e-commerce

INCORPORATING E-COMMERCE IN BUSINESS
system some employees may be rendered jobless. Also, e-commerce can create uncertainty
whereby, some customers are in fear of adding their bank details of personal information to the
website. Some sites are developed with a purpose of scamming some people. Also, there is high
insecurity in the computers systems. Hackers intrude into systems and destroy the data or copy
data that they are not allowed to access. The challenges of e-commerce are quite few compared
to the benefits.
Changes to infrastructure
There are some changes in the infrastructure that need to be implemented. For the
implementation of e-commerce there is a number of items required in the setup (Umar,
Hendriana and Budiyono, 2015). For a successful communication of the system between the
branches, then, some devices such as cables, routers, switches, hubs, desktops, data center are
required. This are the devices required to the network configuring. Also, the data management
infrastructure is necessary. The data management infrastructure will affect the data organization,
data management, data retrieval and the utilization of the available data. The infrastructure shall
be altered to communicate with different parties. Communication is essential in a business. The
communication will enhance smooth business process, as everybody will be informed.
Benefits of infrastructure
For an efficient business process, then a common communication system is necessary for the
entire organization. This include the employees in the head quarter and the employees in the
branches. The system involves all the organization members’ communication their activities and
the requirements. Effective communication will ensure that all activities in the organization are
synchronized as well as the information (Www1.euro.dell.com, 2018). If there is synchronized
information in the company, then the company can be assured of having accurate data. Accurate
data refers to data that is, sufficiently active and used appropriately for the intended use. The data
is also valid. Valid data is importance for the company as it help in making the right decisions.
Valid data is used with the compliance and relevant requirements and should be easily
understood by all parties. Also, redundancy of data is eliminated by used of the infrastructure
(Traxler, 2018). This is as a result of common data center.

INCORPORATING E-COMMERCE IN BUSINESS
The infrastructure also ensures that information in the branches is shared in real time. The
branches should be networked to ensure every branch is up-to-date. The network enable
business-to-business site and server to retrieve data for the authenticated users. The data retrieval
requested is allowed through a firewall. This security to the organizations server and data. The
data requested between business and consumer there has no authentication. The communication
between the customer and the public server is direct and faster (Anon, 2018). The system enables
the organization to get the marketing information by the help of the analytic tools embedded in
the system. This helps the company to get a competitive advantage over other companies within
the same line of business. The company will use the data from the e-commerce to determine the
market.
Finally, the e-commerce helps the company to save more space in the office. This is because, the
employees can hold meeting in the internet rather than meeting in a physical location in the
office.
Major risks
There are a number of risks that may arise while using the infrastructure. First, the business can’t
not predict the future (M. Deulkar, 2017). Uncertain events such as loss of data, vandalism of the
infrastructure, project failure, insufficient project tracking and unexpected scope of business
occur (Lawrence, 2011).The risks are grouped into two categories: information risks and
technology risks.
The information risks include a number of risks. The web page content may expose the publisher
to defamation. The copyright invasion of privacy may occur (Gartenberg, 2018). The copyright
infringement violation is subject to the system. Hackers or other unauthorized people may access
the system and there is a possibility of damage of data or stealing the data. The credit card
information of various customers may also be disclosed and could be used for fraudulent
purposes (Pittalia, 2015).
The technological risks are more compared to the information risks. There is much negligence of
errors of the software design this errors could result to inaccurate data and misleading
information from the system. Also, there are viruses and malware in the system. The internet
service provider server may crash. It could lead to the website connection failure from the

INCORPORATING E-COMMERCE IN BUSINESS
customer, thereby, leading to decrease in the sales. There could also be poor website design that
do to support the business model leading to less sales. Another error is that, there could be poor
integration of the system and database systems. This risk could lead to inaccurate data or loss of
data. Finally there is poor integration of e-commerce system and the internal operations of the
business.
Strategies to minimize the risks
There exists a methodology that could be used in minimizing of the risk. The methodology is
referred to as E-commerce Risk Management (ECRM). The ECRM involves the business
analysis and decision analysis. ECRM involves integration of the business operations managers
and system administrators into the risk analysis. The ERCM identifies potential risks as
highlighted above and find ways of preventing their occurrences. There are various ways of
reducing the risk. First the business operation managers ensures that the business model is okay
and meaningful. The system administrators ensure the system adheres to secure measures such as
use of antivirus, ensure session time out are integration to a system during inactive period. The
system administrator should use monitoring systems to keep an eye on all the system logs based
on the events taking place in the system.
Conclusion
E-commerce is quite helpful in the growth of any business. There are many advantages related to
the use of e-commerce. There is the assurance of business growth once the organization will
follow defined requirement to start e-business. Unfortunately, we due to the high growth rate of
e-commerce we can’t avoid some risks by the organization should have a method of minimizing
the risks.
Recommendation
I would recommend Beckom Company to incorporate e-business into the business processes.
Thus to reach the market demand today (Andrea Payaro and Anna Rita Papa, 2017). The e-
business will improve the business processes and the company will start making huge profit
margin. The company should ensure that it has followed the requirements to be successful.

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