Question

1. With the growth of e-commerce, what kind of Global Business Environment that company should consider?

Answer 1

E-commerce is the business between buyer and seller on electronic platform. Electronic business is growing everyday, in a developing country like India, e-commerce generated nearly $24 Billion in 2015 and in US it was close to $400 Billion.

E-commerce has a two sided impact on employment. On one hand, traditional jobs are disappearing but on the other hand it is creating new job opportunities as well. In e-commerce, it reduces the cost of doing business, is paperless and works 24x7. E-commerce has had great impact on global business. Countries which interacted very less in the past have now greatly benefited from e-commerce, especially the developing economies. E-commerce has paved the way for opening windows for international business which were previously close. It has shown the concept of trade liberalization with the help of globalization. One of the main factors that affect the growth of international outsourcing is the drop in communication cost. The cost of international calls and data charges are reducing now, and e-commerce organisations are utilising this benefit. The main reason why developing countries are encouraging e-commerce is that they are looking at the potential opportunity to get low cost of imports and can gain better prices on exports.

Some of the major impacts of e-commerce on international business environment can be these,

• Increased flexibility in setting up and also winding up of any organisation at the end of each product or process.
• Organisations can now effectively deliver goods and services across the globe with the help of an efficient supply chain logistic partners.
• Businesses can now take the advantage of globalization by distributing various value added activities.
• With the help of experience and information gained from customer data base, globally new products can be brought to market faster as well as cheaply.
• Can benefit from lowest pricing with highest consumer surplus.
• It gives the companies the opportunity to go global with the ability to serve across borders.
• Intense competition from organisations having better resources across the world with less government intervention
• Opportunity for large scale customization of product because of high volume of customers

Other than these, the marketing strategies of business have also changed greatly after e-commerce has entered the market. Organisations should adopt their marketing tools and techniques by closely understanding the nature and behaviour of customers. Hence, in today's era, new digital marketing techniques are used to reach the audience.

E-commerce is showing huge growth in promoting global business and in wiping out the barriers of boundaries between countries. So any business should take all the possible opportunities that ecommerce has created in the market and must make necessary changes as per trends and as per customer needs.