My writing assignment will be about running an e-business. I am focusing on the following two types of businesses: Online Sales of Goods, and Digital Media and Software. My intent is to show that an e–business is easier and cheaper to run than a brick-and-mortar business, but needs a lot of legal expertise.
Here are some examples of online businesses
Online sales of goods: An Online Store that Warehouses products and sells them Online, or one that Drop Ships goods.
Digital Media and Software sales
Also, Online Services: Social sites, Advice, Information
Comparisons to running a brick-and-mortar business:
Is it easier or harder to run than a bricks-and-mortar business? It can be much easier, since you don’t have to maintain a fancy store front, and it can be done with fewer employees. However, it can be complicated to keep things organized. Often, employees work offsite, sometimes from home, and a lot of the work is outsourced from other vendors. It can be hard to maintain solid management with people who are not there, and can’t be dealt with face to face.
Is an e-business more or less expensive?
Internet business can be much cheaper. You can do it without building overhead costs. Even if you manufacture, warehouse, and sell real product, you don’t really need a nice store front, or a nice area for customers to browse through the products. Since customer traffic means nothing to an internet store, you can choose a cheaper location.
Your initial investment can be quite low if you decide to operate in your own home. You may not even need much additional storage space.
If you decide to sell digital media or drop-ship product, you might not need to invest in any additional space, other than a server and a file cabinet for records.
I did find out the hard way that fees can quickly eat up a lot of profit. Ebay and PayPal take a cut of everything, and constantly raise their fees. They claim it is because of their operation costs. In my opinion, these constant increases seem unreasonable. They operate off a minimal staff, their services are all automated. They don’t physically produce or transport anything, so it isn’t like rising fuel prices affect their cost of service or something. Apparently their parents won’t let them keep the eBay file servers in their garage any more. In reality, I can see how legal costs may affect PayPal and eBay. They seem to get sucked into a lot frivolous lawsuits, as if they were being milked like cash cows. I will discuss this later in the paper.
Are there different considerations for choosing an organizational form for doing business over the internet compared to doing business elsewhere?
Online Store - Warehousing products: Your customer service does not have to work face-to-face with customers. They can just be in an office. They can work remotely from home. They can even be in an office in India. They still need to friendly, courteous, and knowledgeable, but they don’t have to have the same appearance...