Electronic commerce (e-commerce) is a new business concept that’s emerging through the dynamic phases of an evolving business world. Based on information technology and business management, e-commerce comprises of electronic data interchange (EDI), online transaction processing, inventory management systems, internet marketing, auto data collection systems, supply chain management, and electronic funds transfer. Firms that utilize the true potential of e-commerce can distribute their services and products more efficiently and inexpensively besides gaining a driver’s position in their target market.
How to distinguish between e-business and e-commerce:
E-commerce is all about exchanging merchandise with the help of an electronic medium known as the Internet. The e-commerce operations may take place between multiple countries and involve the large-scale distribution of merchandise. In comparison, e-business is about performing various business procedures over the internet, which includes business collaboration and customer servicing besides the usual processes of buying and selling.
3 main instruments for conducting e-commerce
The internet dominates the business world for the past one decade. Selecting, ordering, and payment of products are the primary elements of tangible product selling. The traditional method of ground freight is used for shipping tangible products. The key issues in this area comprise of the contract term, enforceability, and secure method of payment.
The basic issues related to a contract are mentioned below:
- Terms of Contract
- Secured payment method
Contract terms associated with a traditional sale need to be reflected by an online sale. The online terms have to be uniform and commensurate with information pertaining to the limitation of liability and warranty for on-package products. All issues concerning a refund and return have to be addressed.
The contract terms often consider it to be an assent when a product gets used, accepted or paid for. However, it’s always better to get the sale terms actively accepted by the online buyer as an affirmation.
Enforceability issues mostly relate to the performance of products and the Warranty claims. All provisions pertaining to limitation-of-liability and warranty have to be examined carefully. You must read through the consumer protection laws and understand the statutory as well as local norms.
Secure Payment Processing is one of the key driving forces behind the success of an online industry. A majority of e-business procedures are being performed over the internet regardless of their volume and nature. The true potential of the internet lies in its ability to conduct numerous informative and commercial activities ranging from shopping to education. Due to the usefulness, the internet network is expanding beyond leaps and bounds. But, there are a few positive and negative aspects associated with it.
The internet users are mostly ignorant about the various alteration methods that are widely prevalent in the online market. The distribution of duplicate online material involves the widespread selling of fabricated videos, music and textual content. As a result of this, digital content has become even more vulnerable to unauthorized utilization and piracy. Certain protective measures like that of the utilization of VPN services have been taken in the recent times to ensure an additional layer of protection for online viewers.
All of the patents, trademarks, and copyrights pertaining to your intellectual property need to be audited. It will help you realize if you’ve done enough for safeguarding your interests. Ensure you have the authority for distributing or recreating products manufactured by a third party. The license that you grant should even indicate all countries that fall within its purview.
You must ensure that the encryption tools are meeting the compliance regulations laid down by the government. You must set policies for resolving all issues concerning non-payment and fraudulent activities.
Few instances of cash payment forgery have been tracked during the past few years. The state authorities and governing bodies are finding it tough to cope with online malpractices involving issues concerning misrepresentation of data and identify theft.
You’re bound to come across many of such instances all over the globe. People are now even trying to avoid cash transactions and opt for other payment modes like online fund transfers and online coupons for household purchases while placing their orders. That’s why the frauds are being controlled by so many legislations.
The UNCITRAL Model Law was passed by certain State legislature in the US for governing e-commerce. There are a few other instances also, like in India the Information Technology Act governs all of the e-commerce activities based on the enactments of this provisional law. The e-commerce gets thoroughly regulated and controlled by the legislatures of the respective countries.