Ara Institute E-Business Assignment: E-Commerce, Supply Chain, Models

This report provides a comprehensive analysis of e-commerce, focusing on the business-to-consumer (B2C) model and supply chain efficiency, using Nuts & Bolts Fasteners (NBF) as a case study. It explores the benefits of e-commerce, including reduced overhead costs, increased sales, and improved customer service through B2C platforms. The report details the B2C business model for NBF, emphasizing its advantages such as wider market reach and streamlined operations. It also addresses challenges like competition and technical issues. Furthermore, the report delves into supply chain efficiency, discussing private industrial networks (PINs), electronic data interchange (EDI), and collaborative commerce, highlighting their roles in enhancing coordination, communication, and overall supply chain performance. The report concludes by emphasizing the importance of technological development and strategic organizational adjustments for successful e-commerce implementation.

RUNNING HEAD: E-Business
0
E-Business
System 0032
[Pick the date]

E-Business
1
1. E Commerce
E commerce is used for buying and selling of products, services and goods through
online platform and is also known as internet commerce and electronic commerce. The name
itself explains the term it is basically selling and buying of things over internet or transaction that
takes place over internet is considered as e commerce (Cassidy, 2016). E-tailing is considered as
using an online platform by retailers where they sale their good and services and that include
business to consumer and business to business model. E-tailing main focus is to change the
structure of organization or to tailor made their business model in order to do sales through
internet or online platform and that changes include building a strong distribution channel,
improved warehouse facility and internet webpages (Mummalaneni, Meng & Elliott, 2016). To
understand this in a better way case study of Nuts & Bolts Fasteners (NBF) is taken and
analysed. It is a family owned business and currently it aims to increase the sales of the company
in market by 5% and to increase the efficiency of company’s supply chain. It is suggested that to
achieve these objectives NBF should opt for the business to consumer (B2C) type of ecommerce.
Because its product range includes bolts, screws, washers, drills, tapes, applicators and much
more. All these products are directly used by consumers and target audience of NBF can be
builders, engineers, trades and business people. And these audiences can be targeted through
B2C channel.
Business to consumer category includes all the transactions that take place online
between business and customer. This means all the orders will be receive by NBF through online
platform that will reduce the overhead cost of the company. Further, B2C category more focused
on supply chain management because in B2C model demand of customers are fulfilled on time
and there is no need to maintain any inventory for longer time. Another thing is that business to
consumer channel deals are done by eliminating the middle man or retailers. Now through B2C e
commerce platform manufacturers can sell products or services to final customers thus
eliminating of middleman helps the company to sell lower than the current prices and that can
increase their sales as decrease in price leads to increase in demand of the product and at the
same time resultant in increase sales (Hiles & Hon, 2016). Sales through B2C channel take less

E-Business
2
time and consumers are ready to pay the price that is displayed on the online channel and there is
no issue of negotiation and bargaining.
In order to compete in the retail market in which NBF works, B2C type of ecommerce is
suitable because it provide various benefits to the company such as reduction in overhead cost
that helps the company to sell its product at lower price to customers, and further NBF
uniqueness is its quality and service this will be improved if they will opt for business to
consumer ecommerce strategy as it will help in ways such that on time delivery, solving
customer query on time and through that customers can track their order status (Mazzarol, 2015).
All these features can help NBF to gain value proposition by opting B2C e commerce. In current
business environment, companies are opting for B2C e commerce such as Amazon as this model
depend on less volume purchases and eliminate bulk buying by the wholesalers (Grefen, 2015).
2. E commerce business model
Business to customer model mainly focus on the marketing and direct selling by business
to consumer through a website (Wirtz. Pistoia, Ullrich & Gottel, 2016). In case of NBF company
can target more audience and increase its sales as there is no geographic limit or there is no
barrier of place. B2C ecommerce business model is explained below; mainly it includes only two
parties that are, business and consumer and all the transactions take place through an online
channel or through a website of the company (Jansen, 2017).

E-Business
3
B2C business model for NBF
The reason behind using this model for NBF is to generate more sales as various benefits
can be achieved to company with the help of B2C model that are single catalogue for all the
products of company, marketing become easy for NBF, lower operational cost, easier operations
and improve the experience of customers because proper feedback can be taken on website and
customization can be done as per the demand of customers (Luo, Shi & Venkatesh, 2018).
Benefits of B2C model for business customers are that they just have to login to NBF website
and they can see the customized price list of their products that they want to purchase and
customer can compare price of product with other sellers also that help the company to gain
customer loyalty by offering the loyal customer discounts. They can finish their purchase in just
a one click and can easily track order on real time basis till it delivered to them (Diba, Vella &
Abratt, 2019). For sellers or for NBF it is an efficient way to reduce its operation cost as this
helps in saving time, have more customer reach without any geographic barrier and that will also
increase the customer satisfaction of their regular or loyal customers who buy products on
regular basis with NBF. This model is opted for NBF to achieve its goal because B2C
ecommerce platform showed a tremendous growth in 2016 and market was valued at USD
2,724.74 billion and the market will grow by 30% in 2020 because of increasing use of
technology and it is also known that half of businesses shift from brick and mortar model to

E-Business
4
brick and click model (Wertz, 2019). NBF can make it more personalized and customized for
their buyers. That will help the company to get more customers. Challenges that customers will
face in B2C model are products cannot be demonstrate to buyers, privacy and security concern,
payment mode and for the company problems might be competition, lower price and technical
issues and technical experts required so these are the limitation of B2C model for NBF (Priem,
Wenzel & Koch, 2018).
Website domain name for NBF: www.nutsboltsfastener.com.au
Revenue model typically includes the amount that a company received from selling its
product in a certain time period. NBF can opt for sales revenue business model and
advertisement based model to generate revenue as these help the company to earn income from
multiple sources. Sales revenue model is based on the selling the products through online
platform and generating revenue only from sales on website. Further, advertisement revenue
model runs on the basis of ads that other company put on website of NBF. So this help the
company to earn extra income through advertisement that company placed on their website of
other companies (Chaffey, Hemphill & Edmundson, 2015). NBF is a manufacturer firm so
company can opt for this revenue model because customer buy in less quantity and due to stiff
competition it is not possible for the company to retain in the market only with sales model.
Another revenue model that can be used by the company is private labelling and manufacturing,
if company don’t want to invest cash they can opt for this model mainly manufacturer firm use
this model and sell the product with private labels and under their own brand name. These
revenue models help NBF to achieve their goals that are to increase sale in retail market and to
improve efficiency in its supply chain (Stott, Stone & Fae,2016).
Organizational development that NBF need to focus on to implement ecommerce model
or B2C model is mainly the technological development. NBF is considered as brick and mortar
platform which has physical presence and also trying to expand online (Kalia, 2015). For online
expansion company need to set up a department of IT that focus on all the online transactions
and other departments are not affected by this change. Firstly, human resource management need
to be focus on and IT experts should be hired and multi skilled people can help in this operation
further a proper internet connection and registered website is to be maintained. Distribution

E-Business
5
channel of the company should be changed or developed so that ecommerce model can be
implemented as strong supply channel is needed in implementing business to customer model as
on time delivery to customer is important and warehouse facility help the company for
achieving operational efficiency (Barnes & Hunt, 2013).
3. Supply Chain Efficiency
Private industrial networks (PIN) are the networks that help in coordinating transaction
between companies in all the areas including retail, suppliers, delivery, distribution and
procurement. This system collaborates and facilitates efficiency in all the networks. Many big
players like Nike, IBM, Dell and Microsoft operates with private industrial networks. In current
B2C era, this helps in achieving the following objectives such as; efficiency in selling of
products in industry, proper resource planning, and improved supply chain visibility to buyers
and suppliers as order can be tracked by the buyers and that helps in keeping the efficiency level
high. Make strong relationship with suppliers and buyers and also helps in improving demand
forecast of products, ensure effective communication between parties and helps in conflict
resolution. PIN used in making the supply chain more effective as to dispatch an order earlier
more procurement managers were required and it took around 7-10 days to process an order but
with the help of PIN supply chain become effective and efficient (Laudon & Traver, 2009).
PIN is much more than just an efficient supply chain as it can coordinate efforts in
engineering and product designing (Kayikci, 2019). Collaborative resource planning and
replenishment help throughout the network to make production plans, to forecast demand,
coordinate stock or inventory and ensure shipping and warehousing in proper way to maintain
retail inventory level. By considering everyone in the system, suppliers, company and business
customers the network ensure quantity and quality control and ensure demands of business
consumers can be fulfilled on time. For NBF this helps the company to bring all the small
business partners together and that collaborate to develop an efficient supply chain. In a nutshell,
the role of PIN system in increasing selling and buying efficiency in a supply chain as supply
chain of a strong firm includes suppliers, mediators and customers for NBF chain includes
suppliers, business customers and logistic partner. With the help of PIN a network of strategic
partners are created that helps in reducing the cost of transportation and increasing the quality of

E-Business
6
product from the suppliers a partners collaborate with efficient supply chain partners (Linder &
Williander, 2017).
In order to improve supply chain of the company, electronic data interchange (EDI) as
this helps the company to interchange information of business with their suppliers or business
partners using a standardized platform and this also includes transfer of information in electronic
form rather than in paper work (Hwang & Lee, 2016). The companies that switch to brick and
click model share their data and information with others through EDI, business documents that
can be exchanged are invoices, purchase orders and payment slips. This platform help NBF to
ensure recording of all the transactions that take place through online platform.
Collaborative commerce includes a means of transferring and integrating the information
technology into e commerce and the main aspect that it covers include how companies can use
technology in business and how that technology helps in achieving better management and closer
integration amongst all the business partners. Collaborative e commerce is also known as c-
commerce (Turban, Lee, King & Liang, 2009). That involves the integration of supply chain in
order to capitalize the economy and using the new technology efficiently. Collaborative
ecommerce is defined as “an application of an inter-organization information system for
electronic collaboration between business partners and organizational employees”. Efficient
supply chain management can be a competitive advantage for NBF to compete in the market.
NBF gets benefits of implementing collaborative e commerce in ways such as cost efficiencies,
lined business processes and higher customer satisfaction and customer loyalty. Some of the key
features of collaborative e commerce are cost reduction, globalization and sharing large amount
of information (Cecere, 2014). All this help in enhancing the relationship with other partners in
supply chain activities and suppliers, customers and business partners will be satisfied with the
technological use in the business and NBF can take advantage of it in a more belter way.. With
the help of collaboration in e commerce the suppliers are involved from global platform also thus
all that makes the supply chain activities of NBF efficient. All these steps and concept of e-
commerce that are discussed above help NBF to achieve its objectives that are to increase the
sales and to make efficient supply chain that increase buying and selling of NBF products.

E-Business
7

E-Business
8
References
Barnes, S., & Hunt, B. (Eds.). (2013). E-commerce and v-business. Routledge.
Cassidy, A. (2016). A practical guide to planning for E-business success: how to E-enable your
enterprise. CRC Press.
Cecere, L. (2014). Building business-to-business supply chain networks. Supply Chain Insights,
1-30.
Chaffey, D., Hemphill, T., & Edmundson-Bird, D. (2015). Digital business and e-commerce
management. Pearson UK.
Grefen, P. (2015). Beyond E-business: towards networked structures. Routledge.
Hiles, A., & Hon, F. B. C. I. (2016). E-business service level agreements: Strategies for service
providers, e-commerce and outsourcing. Rothstein Publishing.
Hwang, K. M., & Lee, S. J. (2016). How does electronic data interchange (EDI) affect the
competitiveness of a firm’s supply chain management?. Journal of Marketing
Thought, 3(2), 13-19.
Jansen, W. (2017). New business models for the knowledge economy. Routledge.
Kalia, P. (2015). Top e-retailers of India: business model and components. International Journal
of Electronic Marketing and Retailing, 6(4), 277-298.
Kayikci, Y. (2019). E-Commerce in Logistics and Supply Chain Management. In Advanced
Methodologies and Technologies in Business Operations and Management (pp. 1015-
1026). IGI Global.
Laudon, K. C., & Traver, C. G. (2009). E-commerce business models and concepts. sl: Prentice
Hall, a divison of Pearson Education, Inc, 63-115.
Linder, M., & Williander, M. (2017). Circular business model innovation: inherent
uncertainties. Business strategy and the environment, 26(2), 182-196.

E-Business
9
Luo, W., Shi, Y., & Venkatesh, V. G. (2018). Exploring the factors of achieving supply chain
excellence: a New Zealand perspective. Production Planning & Control, 29(8), 655-667.
Mazzarol, T. (2015). SMEs engagement with e-commerce, e-business and e-marketing. Small
enterprise research, 22(1), 79-90.
Mummalaneni, V., Meng, J., & Elliott, K. M. (2016). Consumer technology readiness and e- service
quality in e-tailing: what is the impact on predicting online purchasing?. Journal of Internet
Commerce, 15(4), 311-331.
Priem, R. L., Wenzel, M., & Koch, J. (2018). Demand-side strategy and business models: Putting
value creation for consumers center stage. Long Range Planning, 51(1), 22-31.
Stott, R. N., Stone, M., & Fae, J. (2016). Business models in the business-to-business and
business-to-consumer worlds–what can each world learn from the other?. Journal of
Business & Industrial Marketing, 31(8), 943-954.
Turban, E., Lee, J. K., King, D., Liang, T. P., & Turban, D. (2009). Electronic commerce 2010.
Prentice Hall Press.
Wertz, 2019. Ecommerce trend. [Online]
Available at: https://www.forbes.com/sites/jiawertz/2019/07/26/3-e-commerce-trends-
leading-the-way-in-2019/#7ade56be5560
[Accessed 09 09 2019].
Wirtz, B. W., Pistoia, A., Ullrich, S., & Göttel, V. (2016). Business models: Origin, development
and future research perspectives. Long range planning, 49(1), 36-54