Question

In: Economics

How has the Covid – 19 pandemic affected online e-business transactions? Give examples.

How has the Covid – 19 pandemic affected online e-business transactions? Give examples.

Solutions

Expert Solution

The factors driving the growth of the e-commerce industry before the COVID-19 pandemic include fast and steady growth of internet users and increased awareness of online shopping, increased product launch online, low price due to bulk buying, and so forth. Moreover, due to the direct distribution channel and economies of scale, an growing number of unique items in the industry and lower prices of goods further contribute to the growth of the global e-commerce sector.

In addition , following the COVID-19 pandemic, it is further predicted that social distancing and remaining at home would drive customers towards online shopping. Uncertain customer demand and supply chain problems can however have an impact on the e-commerce industry. The COVID-19 pandemic problem may also impact major retailers such as Target, which are witnessing a decrease in casual shopping, supply chain instability, and an rise in sales of basic toiletries, grocery stores, and other items.

The global report on the e-commerce industry is segmented into products like electronics, beauty & personal care in the healthcare sector and others. COVID-19 outbreak had an impact on these segments due to the uncertainty in the supply chain and demand from consumers around the globe. COVID-19 primarily stresses e-commerce supply chains as well as factory closures in China, the US and other countries. The most affected industry segment due to the COVID-19 outbreak is the electronics goods as China accounted for most COVID-19 cases and according to the International Trade Union Federation (ITUF), the country is the largest manufacturer of the electronics and its parts worldwide.

The novel COVID-19 pandemic is impacting e-commerce in various regions like North America, Europe , Asia-Pacific and the rest of the world. The countries in which the majority of cases are registered include Italy, Spain, France , and Germany in Europe and Asia-Pacific in China. China's largest e-commerce service provider Alibaba has struggled to sustain growth rates in its domestic market amid an economic downturn, and faced the uncertainty of coronavirus outbreak. Alibaba Group Holding Ltd., Amazon.com, Inc., Qoo10 Pte are main companies impacted in the market. Ltd., JD.com, Walmart Inc., Shopify, Rakuten and eBay Inc.For example , Amazon has made some strong investments in one-day delivery that aren't quite compensating yet. Its net income decreased by 26% in 2019 and shipping costs increased by 46%. The coronavirus pandemic has an effect on Amazon 's earnings during the first half of 2020


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