UTTARANCHAL UNIVERSITY

(Established vide Uttaranchal University Act, 2012, Uttarakhand Act No. 11 of 2013)
Premnagar-248007, Dehradun, Uttarakhand, INDIA

ASSIGNMENT COVER PAGE

MANISHA GUPTA
Name of Student:
ASSIGNMENT - JULY 24 BATCH
Batch:
MASTER OF BUSINESS ADMINISTRATION (OL)
Program:
E-COMMERCE (OMBA 115)
Subject & Code:
1st SEMESTER
Semester:
2415010853
Learner ID:

NECESSARY INSTRUCTIONS
1. Cover Page must be filled in Capital Letters. All Fields of the Form are
compulsory to be filled.
2. The assignment should be written / computer typed on A4 size paper and it should be neat
and clearly readable.
3. The cover page should be stapled at the front of each and every assignment.
4. Incomplete Assignments will not be accepted.
QUESTION1. List some of the advantages and disadvantages of E-commerce
Ans.
E-commerce involves online business transactions, like selling a product over the internet. Online
shopping platforms generally feature a digital display area with a product title, image, and description.
After selecting a desired product, customers can place it in their shopping cart and proceed to make
payment with their debit or credit card. Certain payment processors also enable you to receive payments
through cryptocurrency and other non-traditional payment methods.

There are various benefits of e-commerce for business owners who prefer not to establish a brick-and-
mortar store. With e-commerce, you can create a cost-effective website and market your products on the
internet. You can drive more visitors to your online store to expand your customer base. Here is a
comprehensive overview of the major advantages of e-commerce.

E-commerce provides a different option from physical shops, yet there are pros and cons to businesses
adopting e-commerce. You may feel inclined to establish an online store and begin selling your
merchandise, but it's crucial to comprehend the commitment involved. E-commerce is a popular option for
numerous business owners, but it might not be the most suitable path for your specific business.

One important factor to think about is the amount of resources needed to develop an online shopping
platform, particularly if you need to enlist the services of a skilled individual. Additionally, you must include
an image, heading, and description for every item you sell. Additionally, it is important to monitor your
website to prevent any bugs or glitches that may compromise customer data security or disrupt payment
processing.

Consequently, what are the benefits and drawbacks of a company utilizing e-commerce? This article will
discuss the definition of e-commerce, the advantages and disadvantages, and if it is suitable for your
business.

Advantages-

1. Reduced overhead costs

Operating an online store is much more budget-friendly compared to operating a brick-and-mortar

store. You can avoid renting commercial real estate by paying a budget-friendly fee for web
hosting. You are not required to spend money on security for your business property, and you also
do not need to be concerned about renting a warehouse or employing staff. When running an
online store, you can expect common expenses like purchasing a domain name, paying for web
hosting, and covering website development, along with stocking up on inventory. With that said,
the majority of online shopping platforms allocate funds for marketing too.

2. No need for a physical storefront

Running a physical store comes with many challenges, but with e-commerce, you can avoid most of
them. Leasing a business space may come at a high cost, particularly in a metropolitan area. You
must also cover the costs of electricity, water, and internet to guarantee that your area meets the
required standards and can support your operations. Security is another factor to take into account;
if you desire to ensure the safety of your brick-and-mortar store, you will have to purchase cameras
and other monitoring devices. By having an online store, you can create your website and begin
selling products without the need for a physical shop or significant financial investment.
 3. Ability to reach a broader audience

The main benefit of e-commerce is that it enables you to connect with a large number of people.
Your brick-and-mortar store may have limitations on the number of daily visitors, particularly in smaller
towns or rural regions. Through an online store, you have the ability to connect with potential
customers worldwide and showcase your products to them. Even if you are not engaging in
international selling, you can still target customers from all corners of the United States to drive up
your revenue. The extended audience has enabled a few smaller online stores to grow into huge brands
in the long run.

4. Scalability

Scalability is considered as one of the most practical advantages for long-term growth among the
benefits and drawbacks of a business utilizing e-commerce. If you own a brick-and-mortar store, your
business can only expand to a certain point before necessitating a move to a bigger location. Moving
inventory and equipment between locations further complicates the process of expanding your store as
your business grows. Through e-commerce, your online presence and shop can expand alongside your
business without the need to invest significant amounts in relocating to a different physical location.

5. Track logistics

Monitoring logistics is crucial for e-commerce and retail marketing, and it is much simpler to do so in
e-commerce than in a brick-and-mortar store. You have the option to delegate fulfillment logistics to
provide your customers with perks such as 2-day shipping and effortless returns processing. Having an
electronic record of all transactions enables you to monitor sales and identify patterns that support
business expansion.

Disadvantages –

1. Potential security threats

There is always the possibility of security threats when conducting business online. Inadequate website
security can enable unauthorized users to access your website and view confidential information.
Rarely, problems with payment processors might result in data breaches that jeopardize the credit and
debit card details of customers. Learning how to ensure the security of an e-commerce website is a
significant aspect of learning to build one, which is why some business owners opt to enlist the help of
a professional.

2. Competition
Competition is fierce in the e-commerce industry due to the accessibility in creating online stores for
everyone. This drawback of e-commerce requires additional effort to ensure your store is promoted and
website traffic is generated. Some niches can be overcrowded, making it challenging to sell your product
based on your industry and offerings. In the end, the efficacy of your store depends on the effort you put
into establishing your online visibility.

3. IT issues
No technological problems can prevent you from accepting cash in-person, but information technology
glitches can be a significant issue for online shopping sites. If your website experiences a sudden crash or
you encounter issues with your payment processor, it could result in financial losses and customer
dissatisfaction. What's more concerning is that resolving these IT problems may end up costing you even
further. Simplifying things can prevent certain e-commerce IT issues, although it's important to stay
mindful of technical problems.

4. Shipping logistics
Running a physical storefront is simple because all you have to do is sell products to customers
when they come in to shop. If you want to sell products over the phone or through a catalog, you
can use a simple shipping service to send out a few packages each week. With an e-commerce
store, you have to figure out all of the shipping logistics because every purchase will have to be
shipped. It can be difficult to figure out a seamless shipping solution for your business, and you
don’t want to end up in the red due to high shipping costs.

5. Limited connection with customers

When you operate an online store, you miss out on the opportunity to engage with customers
personally. Some individuals could lean towards that option, however, it is not possible to
provide the same level of personal interaction during an online transaction.