Ebusiness

E-business Paper Sandy Dalton Acc/340 E-business is conducting business either over the Internet or dedicated proprietary networks with e-commerce a subset of e-business which is mostly buying and selling transactions (Bagranoff, Simkin, and Strand, 2008, p.9). Toys ‘R’ Us is a brick and mortar business that is now engaged in e-business including e-commerce. The process of entering the e-business realm is risky and requires many changes in processes to be successful. The e-commerce portion of e-business is the highlight of this paper. When Toys ‘R’ Us first tried to enter the e-business realm there were many problems. The original site started by the company crashed often, made errors in orders and basically was the example of what not to do when starting an e-business unit. Toys ‘R’ Us made the decision to partner with Amazon.com to build a joint online toy store (Karpinski, 2000, p.12). Toys ‘R’ Us made this decision because it could not manage a direct-to-consumer distribution center or balance the brick and mortar business with the online business (Karpinski, 2000, p.12). This partnership was to last for 10 years. Four years into the partnership, Toys ‘R’ Us started a lawsuit with Amazon.com mainly due to Amazon.com not using Toys ‘R’ Us as the exclusive provider of toy. Toys ‘R’ Us won the suit in 2006 and was able to establish an independent online store. Processes for e-business are different from processes for a brick and mortar business. Many of the processes required for an e-business deal with inventory and the shipping of purchases to customers. Direct to customer shipping has to be implemented effectively. Inventory would have to be increased to ensure products are in stock for the e-business customers. The way that inventories are procured would need to be analyzed to verify that the vendors can maintain the supply with the demand of the products sold on the Internet. The increased inventory could require more space for storing the inventory. A process would need to be implemented to ensure that the correct order is sent to the correct customer. Transactions are made electronically versus in person. An electronic payment system would need to be put in place. Accounting information would need to be collected on a timely basis to ensure that information is accurate. Customer service lines would need to be implemented for questions and complaints about the site. The determination of how the site would be constructed and maintained would need to be made. Several advantages exist for using the Internet for business activities. Communication to customers and vendors is faster. Customers can shop online during non-business hours. The ability to reach more customers is another advantage of e-business. The brick and mortar portion of the business requires customers to enter the store to make a purchase. Limitations of using the Internet for business activities include customers not being able to see a real product, lack of customer service contact, and the possibility of the site being down. Another limitation of using the Internet for business transactions is the types of payments that can be used. In a brick and mortar business, customers could use a layaway plan that might increase sales and an e-business would not have that option. Risks of using the Internet for business activities include loss of sales to the brick and mortar portion of the business, lack of use of the site, unable to fulfill the orders received, viruses, and ensuring that what is order by a customer is what the customer receives. With all the risks and limitations, the benefits of using the Internet would be greater. A company should use the Internet for business. Toys ‘R’ Us is an example of this. The company tried to enter the e-business and failed. Then, after failing to fulfill customers needs and having problems with the site crashing, Toys ‘R’ Us partnered with Amazon.com to enter the e-business realm. When Toys ‘R’ Us determined that Amazon.com was acting not in the best interest of Toys ‘R’ Us so the company severed the ties with Amazon.com. Toys ‘R’ Us entered into the realm of e-business independently once again. This would make the benefits of using e-business far greater than the risks and limitations. References Bagranoff, N., Simkin, and M. Strand, C. (2008). Core concepts of accounting information systems 10th edition. New York, NY. John Wiley & Sons. Retrieved from ReSource at University of Phoenix online materials website. Karpinski, R. (August 28, 2000). E-business risks worth taking on path to success.(Toys R Us merges with Amazon.com). B to B. Retrieved March 30, 2009 from General OneFile database.