eBusiness logistics is different

Roger OakdenGlobal Logistics

Sounds similar but not the same. 

Commentators are still confused about eBusiness and eCommerce. The interchange of these terms is common, so it requires effort by logisticians to understand what the articles are actually referring to.

eBusiness describes an enterprise that operates only in an on-line environment, although the business may use warehouses and logistics service providers (LSP). The total business is driven by an integrated website that incorporates self-service by consumers, to reduce the need for customer service and support.

The typical eBusiness is a business-to-consumer (B2C) model, with a logistics profile that is characterised by high volumes of small orders. These often single line item orders need to be efficiently processed through a warehouse for effective delivery. In addition to the proliferation of small orders, the challenges of an eBusiness are substantial variations in the order flow, delivery of the order to a private address without a guaranteed receiver being home and potentially large quantities of returned goods.

As some companies have learnt, these challenges can affect business viability.Also, logistics operations in an eBusiness is very different from that in a business-to-business environment of picking goods to pallets. Selling products on-line and collecting the money receives all the publicity, but its the receiving, storing, picking, packing and transport of all the items that can harm profits.

eCommerce is different to eBusiness

Thinking about eCommerce more typically applies to businesses that sell to other businesses – the B2B model. eCommerce is the enhancement of your current business processes and systems (typically an ERP or WMS system) through incorporating Internet technologies and applications.

Web-enabled business processes are internal business communications among staff and business-to-business transactions (financial and non-financial) with parties in the enterprise’s supply network.

Given that eCommerce is different from eBusiness sites, the extent to which applications are used will differ. For example, the use of social media to interact with customers will be substantially less for eCommerce sites, because their customers are other businesses that are contacted by sales and customer service staff.

However in a B2B environment, customers should be able to place their purchase orders via a supplier’s website, although a continual challenge at the supplier is integrating, or even interfacing, the eCommerce front end with the main business system.

So, when reading articles about developments in the eBusiness and eCommerce area, ensure that you insert the correct term against the author’s description.

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About the Author

Roger Oakden

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With my background as a practitioner, consultant and educator, I am uniquely qualified to provide practical learning in supply chains and logistics. I have co-authored a book on these subjects, published by McGraw-Hill. As the program Manager at RMIT University in Melbourne, Australia, I developed and presented the largest supply chain post-graduate program in the Asia Pacific region, with centres in Melbourne, Singapore and Hong Kong. Read More...