The Impact of E-Commerce on Different Stakeholders Groups

Aidan Clowes
Mind Map by Aidan Clowes, updated more than 1 year ago
Aidan Clowes
Created by Aidan Clowes about 4 years ago
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A mind map on the key stakeholders to an e-commerce based business and its effect on them.

Resource summary

The Impact of E-Commerce on Different Stakeholders Groups
1 TASK 1: The impact of e-commerce on customers and consumers
1.1 As many consumers and customers use the internet to buy for personal and economic use, the ability to compare allows for other companies to become more competitive. Businesses will then need to decrease the price of their products and as a result the customer can compare prices with little to no switching costs.
1.2 Many businesses that have click and mortar based service use a method of ranking how quickly the business can deliver the product to you. These can consist of standard and express delivery methods. Which will possibly incur extra costs to the customer.
1.3 Travel costs to the customer are reduced if they are having the product or service delivered to the business. This means that they may be more likely to invest in a certain service or product if these costs are removed.
1.4 Customers buying for businesses can now customise an order to suit its specific needs quickly and accurately, by removing human error. These can then be repeated on a regular basis.
1.5 Limitations can include the knowledge and inclusion of a computer to make the transaction possible. With an aging population, it may be hard for them to keep up with modern technology.
2 TASK 2: The impact of e-commerce on employees
2.1 Loss of Jobs
2.1.1 If a business is forced into an e-commerce market by the stakeholders, then they may experience some redundancies, as jobs are removed from the business. These can include floor staff and customer service staff. This is because there would be no interaction face to face with a customer, so this are would not be needed in a click based business.
2.1.2 However with an aging population, the need for a brick and mortar store, and as a result floor staff, would still be needed.
2.2 The hours in which the working staff would be reduced to save on costs of the business, as there would be less need for customer interaction, as the internet website would be the consumers way of interacting with the business.
2.3 In a market, the obsolescence of certain jobs would become an issue if you specialised in that area. This would be shown in the loss of customer interaction face to face.
3 TASK 3: The impact of e-commerce on owners and shareholders
3.1 Positive Impacts
3.1.1 The potential cost savings to a business by having an online system means that they may not have to invest in costs such as rent, and the payment of shop staff.
3.1.2 Impacts on profits would be that the potential to have a wider market share by being the first in the market to go online would mean that you could supply and reach a wider audience and the potential to increase profits is there.
3.1.3 Dividends to the shareholders has the chance to increase in the long term. But to set up these types of projects and system requires constant investment, due to maintenance and updates.
3.2 Negative Impacts
3.2.1 The short term costs to a business can put a business off from investing in e-commerce based systems. Also the costs may not effect a business which is also a click and mortar. This is because the costs that would be saved from having an online only business are countered by the inclusion of a mortar store.
3.2.2 Profits may see a slight increase over time, however, this my not be immediate and success is not guaranteed. Also in a saturated market, a business may not see a rise in sales at all.
3.2.3 Shareholders may be unwilling to take the risk due to a large investment into setting up the systems to make it possible, as the returns may not be significant ever to make it worth it.
4 TASK 4: The impact of e-commerce on landlords
4.1 The access for businesses would not be focused on mortar stores, however it may be focused on internet based, warehouse stores. This is because many businesses that turn to e-commerce based selling do not need physical stores to interact with customers. Thus as a result, less landlords sell their retail space to businesses.
4.2 landlords may need to advertise the space for private use, rather than for retail.
5 TASK 5: The impact of e-commerce on suppliers
5.1 Some businesses that move to a sole click based business may close their retail mortar stores. this is because they cannot afford the physical business and as a result the stores close down. This then saves the business the cost of the rent and other costs that come with maintenance.
5.2 The trends of online growth show that it is rapidly increasing, however the statistics say that 80% of all businesses have a mortar store of some sorts. However this figure is increasing as it becomes more economically viable to become and online store, as there is less risk to the business, as the set up costs are reduced.
6 TASK 6: The impact of e-commerce on the local community and wider society
6.1 High street closures
6.1.1 some businesses may close their high street shops as relocating to the internet saves on some many fixed costs that business may not have the funds to afford. This closure may resulting more redundancies and less immediate business activity, as many products and services take time to get the customers.
6.2 Peoples starndard ofliving
6.2.1 Peoples standard of living could bth be dramatically and ungrammatically effected.
6.2.2 A family may be able to live more remotely from the centre of towns and cities, as the products that they need can be delivered right to them.
6.2.3 A persons standard of living may decrease if the introduction of e-commerce ina business leads to job losses and the lack of an income severely reduces ones standard of living.
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