The Impact of E-Commerce on
Different Stakeholders Groups
1 TASK 1: The impact of
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
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
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
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
certain jobs would
become an issue if
you specialised in
that area. This
would be shown in
the loss of customer
interaction face to
3 TASK 3: The impact of
e-commerce on owners and
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
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
6.2.1 Peoples standard of living could
bth be dramatically and
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
e-commerce ina business
leads to job losses and
the lack of an income
severely reduces ones
standard of living.