PROJECT

ON
E-COMMERCE IN GLOBAL SCENARIO

Submitted in partial fulfillment of the requirements for MBA programme of Guru Gobind Singh
Indraprastha University, Delhi

Submitted To: Submitted by:

Ms. Ranjeeta Popli Rahul Arora(05380003911)

(Assistant Professor) Shalini Chadda (02480003911)

Jaideep Singh (05180003911)

Eklavya Kohli (03280003911)

Priyanka Rawat (01980003911)

Chaitali Sharma (00980003911)

GITARATTAN INTERNATIONAL BUSINESS SCHOOL

 ACKNOWLEDGEMENT

Apart from the efforts of our group, the success of any project depends largely on the
encouragement and guidelines of many others. We take this opportunity to express our gratitude
to the people who have been instrumental in the successful completion of this project.

We would like to show our greatest appreciation to Ms. Ranjeeta Popli (Assistant Professor ,
GIBS) . We can’t say thank you enough for her tremendous support and help. Without her
encouragement and guidance this project would not have materialized.

The guidance and support received from all the members who contributed and who are
contributing to this project, was vital for the success of the project. We are grateful for their
constant support and help.
 PREFACE

E-commerce as anything that involves an online transaction. E-commerce provides multiple

benefits to the consumers in form of availability of goods at lower cost, wider choice and saves
time. The general category of e-commerce can be broken down into two parts: E-merchandise:
E-finance. E commerce involves conducting business using modern communication instruments:
telephone, fax, e-payment, money transfer systems, e-data interchange and the Internet. Online
businesses like financial services, travel, entertainment, and groceries are all likely to grow.
Forces influencing the distribution of global e-commerce and its forms include economic factors,
political factors, cultural factors and supranational institutions.

It has an impact over the economy of many countries among which India is on the top of that list.
It has named as new gold rush in e-commerce. E-commerce has many reasons that why it is very
crucial in developing the country . For the study we have taken several parts of the world such as
North America , Latin America , Europe , Middle-East , Africa and South Asia ,and Australia. E-
commerce has an intent to bring some transformation in the society and that’s the reason its
essential for the B2B and B2C commerce .
 SCOPE OF STUDY

This study being “desk analysis" contains views of various writers and researchers of E-
commerce. This study includes the global trends including India as a major source of E-
commerce , increasing use of e- commerce in developing nations , reasons behind success of e-
commerce as an industry , the use of e-commerce in global sourcing , advantages of E-commerce
and several more topics being covered under the project analysis. The use of e-commerce in
various countries and their influence over the people or citizens of that country is remarkable.
 RESEARCH OBJECTIVES

The study is focused on achievement of following objectives:

 To assess the latest trend in e-commerce globally.
 The impact of growth of e-commerce.
 To analyse the latest global scenario of e-commerce.
 The impact of growth on overall economy.
 . EXECUTIVE SUMMARY

The Internet is dramatically expanding opportunities for business-to-business (B2B), Business-

to-consume ( B 2 C ) e -commerce transactions across borders. For B2Ctransactions especially,
the Internet sets up a potential revolution in global commerce: the individualization of trade. It
gives consumers the ability to conduct a transaction directly with a foreign seller without
traveling to the seller’s country. While this could be done in the past by post, telegram, phone,
or fax, such sales were relatively rare because the consumer had to know in advance where to
make contact and what to buy. The Interne t al lows sellers to put their storefronts, in the
form of Web pages, in front of consumers all over the world. Technology has expanded t h e
consumer marketplace to an unprecedented degree, and it will change the way we think about
trade. The implications of this for economic development, globalization, and cultural exchange
are immense . This creates opportunities for both consumers and small enterprises that
must not be squandered. But for all the potential of global e-commerce, there are countless
vexing policy questions to be worked out, any one of which can threaten the viability of this
nascent form of trade. All of the Internet issues being debated in the United States—consumer
protect ion, data privacy, taxation, content regulation, copyright, spam, technology deployment ,
and many more—need to be resolved at the international level as well .

However, unlike the United States ,which has a federal government and a constitutional
guarantee of free trade, global ecommerce faces two additional serious complications: no central
international authority to make the rules and regulations and no uniform commitment to global
free trade . Moreover, conducting electronic commerce across national border s adds many
more policy issues to the mix—jurisdiction, customs duties, import and export restrictions ,
intellectual property licensing, and more—that are only now being examined.
 TABLE OF CONTENTS

Acknowledgement
Preface
Scope of the study
Objectives
Executive summary
I.Introduction of the topic
 Research methodology

II.Conceptual Framework
 Global trends in E-Commerce
 E-commerce in India
 E-Commerce in Global Sourcing Scenario.
 Security concern in e-commerce
 E-commerce: A Boon for the Current Economic Downturn
 Key Reasons for success of e-Commerce
 Factors affecting Distribution and form of Global e-commerce.
o Internet Adoption.
o Buying and selling online.
o Advertisement and searching phase.
o Payment phase
o Delivery phase.
 Brief review of literature on e-commerce.

III.Summary & Conclusion

References
 CHAPTER-I
INTRODUCTION

E-commerce (electronic commerce or EC) is the buying and selling of goods and services on the
Internet, especially the World Wide Web. In practice, this term and a newer term, e-business, are
often used interchangably. For online retail selling, the term e-tailing is sometimes used

Electronic commerce is generally considered to be the sales aspect of e-business. It also consists
of the exchange of data to facilitate the financing and payment aspects of business transactions.

E-commerce can be divided into

 E-tailing or "virtual storefronts" on Web sites with online catalogs, sometimes gathered
into a "virtual mall"
 The gathering and use of demographic data through Web contacts
 Electronic Data Interchange (EDI), the business-to-business exchange of data
 E-mail and fax and their use as media for reaching prospects and established customers
(for example, with newsletters)
 Business-to-business buying and selling
 The security of business transactions

Today Ecommerce is an integral part of business because of various reasons like:

 Ease of use & Accessibility all across the globe

 Great variety & easy compassion of products from different vendors

 Trusted payment channels

 Shopping can be done sitting in the convenience of home shopping, hence it is

less time consuming.
It is therefore very important for any new entrepreneur to understand the significance of E-
Commerce and should know how to utilize this tool for the growth and development of business.

So, whether you have an existing business or launching a brand new business, whether the
volume of your business is large or small, you can always generate profit by demonstrating your
products or services online, thereby acquiring a large amount of viewer exposure. In concise,
buying and selling will result in profits and returns.

There are so many factors which makes e-commerce to come to the fore front in today's world.
Saving precious time involved in business transactions is really a prominent factor. Like for
instance, net banking makes it easy to carry out money and baking transactions in a break neck
speed as compared to the real banking scenario. This asserts the fact that Ecommerce is
beneficial to both business and consumer wise as payment and documentations can be completed
with greater efficiency and reliability. Another important factor determining the flow of whole
business is connectivity. Connectivity is very important for both consumers and business.
Ecommerce provides better connectivity for all the potential candidates all over the globe, thus
helping in enhancing the business without any geographical barriers. From the view point of the
customer, Ecommerce is a good platform for hassle free shopping by sitting in your home. The
customer can browse through all the products and services available and can review and compare
the prices of the similar products available in the online space.

In global market scenario, the emergence of Ecommerce as a forerunner has opened up various
windows of opportunities for a variety of online companies and investors. More and more
resources are being directed into electronic securities, internet facilities, business plans and new
technologies due to the boom in the space of E-commerce. As a result various new markets have
emerged from Ecommerce itself giving a boost to the global market.
Research Methodology
Sources of Data
For having the detailed study about this topic, it is necessary to have some of the
secondary information, which is collected from the following:-Books, Websites
and Newspapers. So in this basically secondary data is used in collecting the
information. The sources of data are:

Websites:

 Wikipedia
 Wikinvest
 India-commerce

Newspapers:

 Hindustan Times

Type of Study

The research design or type of study specifies the methods and procedures for
conducting a particular study. The type of research design applied here are
“Descriptive” and “Desk Analysis” as the objective is to have knowledge about
the ecommerce in global Scenario. Descriptive study means situation, but not
the causal linkages among its different elements. Descriptive studies (such as
a cross-sectional study) help in generating hypothesis on which further
research may be based. Desk analysis is to Gather and analyze information, already
available in print or published on the internet.
 CHAPTER-II

CONCEPTUAL FRAMEWORK

Global trends in E-commerce

 Government programs are a significant vehicle for c-commerce implementations

 Retail, grocery and logistics industries are the most active in encouraging trading partners
to implement EDI
 Small and medium sized companies demand flexible integration solutions
 European companies focus on core competencies and outsource technology to consulting
groups
 High percentage of first time implementers seek to achieve full integration
 Organizations are seeking a scalable, reliable system that is easy to deploy and manage
 Software needs to be capable of handing different business processes and must integrate
with existing IT investments

As social media, app stores and global availability become standard, many companies are
looking to enhance the online customer experience. And while retail and other transactions via
Internet are customary, more than ever companies are simplifying the ways in which customers
interact with their website and ultimately make online purchases. Here are eight trends
happening right now in global e-commerce that seek to enhance the user experience:

 Micro-payments – Among the most revolutionary changes in the coming months—not

years—is the use of micro-payment systems from a variety of financial firms, e.g.,
Paypal, Visa, WesternUnion, among others, including banks. This trend is facilitated by
the W3C working group that approved these protocols and technical standards for the
interworking. These systems will change not only how we carry money but how we value
money and think about purchases. (Consider how a purchase of $4.99 feels in a mobile
app store vs. at Dunkin' Donuts.) Payment systems that make it easier to buy online,
coupled with mobile technologies will accelerate the usage of global e-commerce
applications.
 Mobile technologies – More people access the Internet on their mobile devices than on
any other device. We are rapidly approaching the time (if we are not already there) where
designs must be created for the mobile Web first, and for the desktop second. Mobile
technologies facilitate comparison shopping; with the advent of barcode reader apps and
price-comparison databases, a consumer could snap a bar code in Walmart and quickly
reference product reviews and prices on walmart.com (or compare prices with Walmart
competitors). Mobile technologies also facilitate impulse buys – especially with the
advent of micro-payments tied to the mobile device. Just recently, Starbucks customers
can not only place an order with their Smartphone, but also make a purchase.
 Social media – As Facebook has become the most visited site on the Web, the role of
social media, including Facebook and its local clones such as Twitter, is increasingly
important. Social media sites increasingly act as points of entry to e-commerce sites, and
vice versa, as e-commerce sites build rating, loyalty and referral systems tied to social
media. Group buying (e.g., Groupon) is also gaining mainstream ground, with many
"deal of the day" sites competing for an increasingly savvy consumer base, but
improvements lie ahead as the social aspects and user experience are refined.
 Fulfillment options – I believe that users will want to have multiple fulfillments and
return options when interacting with a vendor: ship to address, courier, pick-up in store,
return to store, etc. Having many fulfillment options is how customers view their overall
customer experience. Some companies have made a business proposition online by being
exceptional in service to the online channel (e.g., Zappos).
 Global availability – Increasingly, consumers want the availability to buy products from
foreign sites and have them delivered locally. Thus, currency and customs will be of
growing concern to many online retailers. Along with this, there will be concerns with
local privacy laws and restrictions on related data collection and storage.
 Localization – While the trend is to globalize, what’s often more important is to
localize. User Centric’s research clearly shows that sites that ‘feel’ local – with proper
imagery, language, time/date, weights/measures, currency, etc. – resonate far more than
sites that seem culturally distant or sterile.
 Customizability – Consumers want control, and want to be able to design the details of
the items they purchase.
  Time-based availability – Some of the hottest and most successful sites are those that
have a time-critical response component. Sites like Groupon, Gilt and others capitalize
on the perception of limited-time availability. Creating a sense of urgency drives traffic
and purchase behavior.

Business models across the world also continue to change drastically with the advent of
eCommerce and this change is not just restricted to USA. Other countries are also contributing to
the growth of eCommerce. For example, the United Kingdom has the biggest e-commerce
market in the world when measured by the amount spent per capita, even higher than the USA.
The internet economy in UK is likely to grow by 10% between 2010 to 2015. This has led to
changing dynamics for the advertising industry

Amongst emerging economies, China's eCommerce presence continues to expand. With 384
million internet users, China's online shopping sales rose to $36.6 billion in 2009 and one of the
reasons behind the huge growth has been the improved trust level for shoppers. The Chinese
retailers have been able to help consumers feel more comfortable shopping online. eCommerce is
also expanding across the Middle East. Having recorded the world’s fastest growth in internet
usage between 2000 and 2009, the region is now home to more than 60 million internet users.
Retail, travel and gaming are the region’s top eCommerce segments, in spite of difficulties such
as the lack of region-wide legal frameworks and logistical problems in cross-border
transportation. E-Commerce has become an important tool for businesses worldwide not only to
sell to customers but also to engage them.

Asia Pacific

Chinese and Korean online consumers are the most prolific online shoppers m the Asia Pacific
region with 95 percent of Internet users intending to make a web purchase in the next six
months.Conversely, over one fourth of online consumers In Hong Kong (27%) and Thailand
(26%) and one fifth of residents in Japan. New Zealand, Indonesia and Australia do not plan an
online purchase m the upcoming months. Koreans who shop online are most likely to buy books,
cosmetics, clothing/accessories/shoes and groceries via the Internet in the next six months. While
connected Chinese also favor books and clothes. 40 percent plan to make an electronic purchase
online. Web-savvy Malaysians like online shopping for booking travel, with airline tickets and
hotel/tour reservations the top picks. More online Australians intend to purchase event tickets
and non-downloadable videos/DVDs/games than any other in the region. And one fifth of online
Indian shoppers plan to buy non-downloadable music.

Total online spending as a percentage of total monthly spending vanes by country with Chinese
and Korean online consumers allocating the most via the web than any other in the region.
Online consumers in New Zealand. Australia, Malaysia and Hong Kong allocate the least.

Europe
Intention to shop online in Europe is high—79 percent of online European consumers plan to
purchase products or services via the Internet in the next six months. Online consumers in
Norway and Great Britain show the greatest propensity with almost 90 percent planning a web
purchase in the near future. More online residents of Estonia & Croatia and Latvia indicate they
would not be making any online purchases in the next six months than in the rest of Europe
(42%. 41%. and 41%. Respectively)

More than half of online Austrians who shop via the web plan to buy books, while online
Germans and Czechs intend to turn to the Internet for clothing and shoes more than any other
online shoppers in the region .Future online purchases for Norwegians are likely to include a
vacation or a show as indicated by their strong intent to purchase travel aid event tickets More
than one third of online Brits plan to purchase DVDs and games online. while connected Greeks
indicate a preference for electronic equipment and computer hardware. Web-savvy Israelis seek
the Internet to purchase electronic equipment more than any other item and are the least likely in
the region to purchase clothing or shoes online.

North America

Half of online Americans favor sites for stores that can only be shopped online and the majority
of Canadian web shoppers are split between a preference for online-only sites (31%) and those
that have traditional physical stores (19%) the list of products and services that are favored by
American and Canadian online shoppers is almost identical. Books, clothing and airline tickets
are the items most likely tagged for online purchase in the next six months. One-third of online
Canadians say they don’t plan on making an online purchase in the next six months, which is
more than the one-fifth of connected Americans who said the same. In fact, 28 percent of online
Canadian consumers indicate that they have never shopped online compared to 15 percent of
Americans.

When selecting the top three sources to guide decisions, online product reviews are useful to 42
percent of American and 40 percent of canadian web shoppers. Online reviews are most
important when buying consumer electronics, cars and software and when researching cars.
Electronics and travel.

Latin America

Connected Brazilians are the most prolific online shoppers in the region with 84 percent planning
to make an online purchase in the next six months. The items that top the list are books,
electronic equipment. Computer hardware and DVD5/games. Conversely, online Colombians are
the least likely shop online in the near future—3 6 percent indicate they have no plans to shop
virally in the next six months and more than one-fifth indicate they have never shopped online.

Electronic equipment tops the list for planned online purchases for 34 percent of Venezuelan
web shoppers followed by airline tickets (27%) and computer hardware (21%). Surprisingly,
books—which typically tops the list for most online shoppers—was favored by only 18 percent
of online shoppers in this country.

Online purchase intent in Mexico is evenly divided among the top eight products and services:
books (3 0%), electronic equipment (25%). tours/hotel reservations (24%) event tickets and
music (22%), computer hardware (21%) clothing and video/dvd1s/games (18%). Also equally
distributed is the choice of sites that connected Mexicans prefer when shopping online.
Middle East / Africa / Pakistan

Shopping online Is the most underdeveloped In the Middle East, Africa and Pakistan region.
Almost half (47%) of online consumers indicate they have never made an online purchase—the
highest percent of any other region in the world. Of those connected consumers who have online
access, one-third say they do not plan on making a purchase in the next six months.

The most popular products and services for planned online purchase across the M EAP region
are books (29%), airline tickets/reservations (24%) and electronic equipment such as TV’S and
cameras (23%). Other popular planned online picks for South Africans are event tickets (33%)
and non-downloadable music (26%). Online residents of the United Arab Emirates intend to
book travel (27%) and buy clothing (25%). Web-savvy Pakistanis will look online to buy
computer hardware (25%) and clothing (18%), although they also lead the region saying they do
not plan on making an online purchase in the next six months (38%).

Social media is not yet playing much of a role in influencing consumers’ purchasing online,, but
Saudis are most likely to use such sites to help make buying decisions. While the majority on
online consumers in the region is not more Likely to share a negative rather than a positive
experience online, Egyptians and Saudis are more Likely than any other in the region. Online
reviews and opinions were most Important when buying and researching cars, software and
consumer electronics
E-commerce in India

New Gold Rush in E-commerce in India

Kunal Bahl, founder- CEO of e-commerce site Snapdeal.com bought out eSportsbuy.com for an
estimated of Rs.50 crores.

Bahl has 20–million (Rs. 100 crore) stash for acquisition-significant because Snapdeal is itself a
startup-but a rich on. It has raised Rs.52 million from ventures funds.

Bahl is not alone who is scouting for potential suitor. In February this year aggressively online
shopping site Flipkart.com acquired rival Letsbuy.com. Early last year, US-based social buying
site Groupon acquired India’s SoSasta.com and renamed it as Crazeal.com.

And so it seems that e-commerce is not about customers buying goods. It is about firms shopping
for others. Industry trackers say leading sites are gobbling up rivals to build size, or acquiring
customer niches either to add product segments or to get technologies that help efficient
operations.

In the game in which future share issues are on the radar for bigger players, the smaller ones
often prefer to cash out than be crushed in lonely pursuits in an aggressively competitive game.

At stake is a huge market will growing potential because India has 900 million mobile phones,
with a big chunk of that growing up from voice talk to Internet, wile the current Web user base at
more than 100 million is in itself a significant number.

Industry estimates say India’s e-commerce market will zoom from the current Rs.51000 crore to
Rs.10,20,000 crore in revenues by 2020. The race lead to buyouts-often at the cost of
profitability.

“At present sites are falling over each other to offer deep discounts, but you do not survive only
through discounts. This only creates a disloyal discount shopper who moves from one site to
another in search of the cheaper deal,” said Mahesh Murthy , managing partner of investment
firm Seefund Advisors. Murthy added that sites without a credible differentiation strategy and
loyal customers base would bleed-and will be up for grabs.
Experts say acquisition of other sites is also a good strategy to built brand and broaden a loyal
customer base. Snapdeal.com snapped up eSportsbuy.com to get access to its large catalogue of
sports and fitness products. Flipkart.com started out with books, added cameras and mobile
handsets and then got Letsbuy.com to acquire muscle in electronic goods, while Groupon’s
buyout was to enter India.

“There in no room for newer players in the general category but there is space for niche category
players,” he said. This has been observed by Prashanth Prakash, partner at Accel partners, which
has invested in Flipkart.com.

Private enquiry is doing a huge amount of work backstage. Venture capitalists say they more
than doubled the funding level in e-commerce over the past year, and the average size of
investment has ranged from Rs.20 to 40 million.

However, having a deep pocket is no guarantee to success. “Money can only delay your death.
The only key to survive is to have a credible differentiation strategy,” Murthy said.

Size is not everything, but could help if investors have a sense of timing. “As the e-commerce
companies grow and get brand loyalty the valuations are expected to increase even further. It will
be the time when we can offload our stake, for hefty profits,” a venture capitalist with significant
stake in leading e-commerce site.

Hundreds of Internet startups went bust in 2000 and 2001 in the “dotcom bubble” and comparing
the current e-commerce rush to that may not be farfetched said Shailen Amin, co-founder and
CEO of footwear sites Bestylish.com.

“There are a lot of guys in this business who don’t have a retail background. They are form
either consulting or technology. So one should ask if they are really qualified to run e-retail
businesses.”

In the world where old-fashioned retail meets high-technology and innovative management, the
winners could well be those who understand dimensions.
What the consolidation?

 High operational costs affect profit margins.

 Most e-commerce sites compete on deep discounts, which hit their margins.
 Some firms feel the time is right to cash in on brand, customer base.
 Private equity (PE) and venture capitalists (VC) are eyeing safe exit while e-
commerce ventures are still profitable.

What makes a Long-Term Player?

 Loyal customer base, fundamentally strong business models, clear product/service

differentiation.
 Deep pockets to tide over initial gestation period.

Challenges for E-Commerce Sites

 Low customer loyalty

 High returns rates on cash-on-delivery
 High cost of customer retention

State of Play

 Acquiring site is a good way to built brand, broaden loyal customer base and add
categories.
 The companies that are selling have real valuations, real transactions and real customers,
and are not based on eyeballs.

E-commerce companies in India offers the most tangible and finest e-commerce solutions,
provide high end e-commerce solution taking utmost care of the privacy and security of the e-
commerce website. E-Commerce service includes shopping carts, database programmers,
graphic design services, graphics, e-business, Flash designs etc.
Top ten e-commerce companies in India

 20North.com:

This website offers variety of products like electronics ,books ,music ,movies ,car accessories.
The site also offers lucrative deals. Log onto the site to shop. Happy Shopping!!!

 99labels.com:

This site offers many fashion and luxury brands at good prices. Check this site for more brands .

 Dealsandyou.com:

This site offers various kinds of deals be it holidays, shirts etc. Also this site gives heavy
discounts on regular basis that cab be profitable for the shoppers. Browse this site for more.

 Fashionandyou.com:

This site also is a great place to shop and that too sitting at home. Also this site declares sale and
heavy discounts almost every day. Sign Up today to get more deals.

 Flipkart :

This site offers various kinds of products and that too at one place. Mobile, its accessories ,
books, camera and laptop accessories. and many more things are available on this site. One can
find deals for home appliances also that are available at affordable prices. Check this site

 Indiangiftsportal:

This is known for providing gifts for various occasions like birthdays ,anniversary, wedding,
bhai dooj, diwali and many more .Also flowers, cakes ,chocolates and many more things are
offered by this site. Browse it today to send gifts to your loved ones.
  MagazineMall:

This company specifically deals in magazines and one can get magazines of different and
unique categories like Gardening/Housekeeping, lifestyle, fashion, luxury, current affairs
and many more.

 Bindaasbargain:

Here new deal comes everyday at 10 am and it is India's first One Deal A Day online shopping
site.Check out the site for new deal. Happy Shopping

 Buytheprice.com:

The site offers Mobiles, Computers, Cameras, Home Appliances ,Life style, Audio and Video
and much more. Variety of products are available under each category.

 Perfume2order:

It has categories like Perfumes for Men, Perfumes for Women, Deodorants & Deo Stick,
Perfume Gift Set, Designer Wallet & Belts, Flowers, Handbags & Clutches, Sunglasses and
many more things.
E-commerce in Global Sourcing Scenario

What Is E-commerce And How Does It Augments Global Sourcing?

E-commerce or electronic commerce, as it is popular, allows domestic as well as international
trade over the Internet. The advent of E-commerce is boon for global sourcing and import and
export. The boost to global sourcing and import/export through E-commerce is because of its to
conduct online marketing, monitoring supply chain and monetary & data transaction in a
dependable manner.

Evolution of E-commerce with Global Sourcing?

It is hard to tell whether import/export volume has swelled because of E-commerce but sure it
made global sourcing easier to monitor with its evolutionary phases. Three decades ago, it
facilitated fund transfers- albeit electronically besides facilitating exchange of POs and invoices
in international trade. Electronic teller machines are the recent manifestations now overtaken by
internet creditcard processing and endorsement of unsigned invoices even in international trade.

Why is E-commerce Popular in International Trade and Import/Export?

Looked at from both import and export traders' perspective, international trade is easier
conducted electronically. Here are the points why present international trade depends much on E-
commerce.

 Quick and ease of setting up E-commerce storefronts for both global sourcing as well as
import/export.
 Automatic running off of an import and export outfit without having to recruit many
staff.
 Global sourcing agents/companies can evaluate/list import/export vendor Online.
 Software assisted documentation for each global sourcing and import export transaction
 Ability to handle multiple, quick and secure data and money transaction crucial to
international trade, simultaneously
In international trade, global sourcing happens to be one of the chief aspects of import and export
business. Global sourcing is an integral part of B2b scenario and has essentially transformed
world economies as well as boosted business in a great way. Nonetheless, it is also giving great
transformation to the work culture around the globe with China playing a lead role in global
sourcing. Nevertheless, it is also transforming work cultures around the world silently with
China business playing a major role.

Being an extension of open market dynamics, global sourcing facilitates the export and import of
goods to be in the reach of several small and medium enterprises in different countries. In this
b2b scenario, E-commerce plays an active role in the global sourcing where the business houses
are putting in deep efforts and reaping the benefits. In this rally of export and import, traders
happen to claim the share of the pie in global sourcing.

E Commerce & Global Sourcing

 Global sourcing is one of the widely known strategies of ensuring smooth business and
access to markets in a cost effective manner. In such a scenario, E-commerce has brought
in a new transformation. It has added to advantages like removing the barriers of time
zones, differences in costs, geographical locations etc. This has resulted in a major push
in development in infrastructure, technology and several other sectors across the globe.
As we see, E commerce is driving the export and import and propelling the economic
growth of numerous developing as well as developed nations. Business strategies are
becoming easy to execute and business houses are having a wide range of options from
where they can make their choices.
 E-commerce has made the path of business smoother and has facilitated not only in lower
cost, but also resulted in procuring material from places where there is specialization.
Moreover, business negotiations are easier and decisions are quicker due to this boon.
Driving the import and export business in this global sourcing scenario has opened new
frontiers for higher growth. The ease in supply chain is one of the best advantages that
has come from e-commerce in the global sourcing scenario.
 China, a major player in the global sourcing scenario has reaped several benefits in the e-
commerce enabled era. The use of internet has facilitated trade and boosted it at an
 immense rate. Business from all over the world has been bagged by this country in spite
of the competitive market. Chinese traders have minted fast money and are still running
in that race.

Security concerns in Global Sourcing

E-commerce is not without security concerns, loss/misuse of encrypted data which are still being
seriously being viewed by import/export operators before engaging in international trade
electronically. The truth is E-commerce providers employ SSL (Secure Sockets Layer) to
encrypt data/money (remember banks) transfer from your desktop to your clients'. You can say,
E-commerce is secure for both import/export operators as well as global sourcing agents alike.

E-commerce has arrived on the global sourcing scene as both import and export and international
trade partners are accepting it. Despite its growing stature and popularity E-commerce is still
thriving in retail sector domestically and the international trade needs to cover a long distance
before it catches up. Another reason for import/export operators' leaning towards E-commerce is
the growing costs of delays in processing POs and invoices through traditional methods which
render global sourcing useless.

E-commerce: A Boon for the Current Economic Downturn

E-commerce: A Boon for India

By the end of 2011, the e-commerce market in India had clocked close to Rs 50,000 cores. It is
interesting to consider whether the global economic downturn may have negatively impacted the
growth of e-commerce or possibly accelerated it as consumers look to new online channels
which can often deliver greater value than traditional stores.

Today, even though there are less than 10 million internet users who are actually engaging in e-
commerce activities, there are about 150 million internet users in India or around 75 million
households that are ready for e-commerce.
The growing reach in terms of internet connectivity to the interiors of India coupled with the
positive experiences of end consumers when buying online beyond the metros and big cities are
key drivers of the e-commerce boon in India. Businesses in even the smallest towns and villages
are becoming increasingly aware of e-commerce and are excited by the growth potential.

The growing penetration of e-commerce along with positive consumer experiences is reflected in
a trend towards higher value online purchases. Today, consumers across urban India are
confident enough to make purchases that exceed Rs 20,000-25,000. Earlier, the same shoppers
stayed in the Rs 2,000-5,000 ranges. According to one study almost 57% of business for e-
commerce product sites came from tier I, tier II and tier III cities while the eight metros
accounted for the remainder 43%. The same pattern was visible in the service sites too, with tier
I, tier II and tier III cities contributing 54% of revenue versus 46 % by the eight metros.

According to a report by the IAMAI, the current e-commerce market in India is around US$ 10
billion. But with different levels of adoption, the market has the potential to grow anywhere
between US$ 70 billion – US$ 150 billion under one scenario and at another level it can grow
between US$ 125 billion – US$ 260 billion by 2024-25.

E-commerce: The world over

Globally, the scenario is much the same. Brazil, one of fastest growing economies
in Latin America, is seeing considerable growth. According to a recent report, it
estimates business-to-consumer (B2C) ecommerce, including both retail e-
commerce and online travel sales, will total to $18.7 billion in 2012, a growth of
21.9% over the previous year. Brazil will account for more than half of the total
B2C e-commerce sales in Latin America through 2013, thanks in large to its huge
populace and growing number of online buyers.
Retail e-commerce itself in the U.S.is predicted to grow at 17% and it will likely
account for $200 billion in sales in 2012 , according to a presentation at a popular
forum. Retail e-commerce totalled $48.2 billion during the third quarter of 2011;
an increase of 13.7% compared with the third quarter of 2010, according to
estimates from the U.S. Census Bureau. 2011 also saw the European online market
boom despite the floundering euro. Germany’s online trade increased 17% in 2011
to €21.48billion compared to 2010, crossing the €20 billion mark for the first time,
outstripping traditional mail order sales by 10%. A similar growth rate of 10% to
15% is expected in 2012.

In the global scenario, China is fast emerging as the biggest player in e-commerce.
According to an e-commerce report, by 2015, it may well surpass the U.S. In an
astonishing illustration of its online growth rate, China has added the equivalent of
the entire population of France in internet users in each of the last four years. It
will add the equivalent of the entire population of Canada as e-shoppers in each
of the next four years. China is projected to rise from 145 million e-shoppers
today to 329 million by 2015.

Key reasons for the success of e-commerce

 Shopping 24x7: E-commerce facilitates shopping anytime, anywhere and
for almost anything desired. Busy consumers prefer this to the restrictions of
when a mall/shop is open and the need to physically travel to a shop. Online
business takes shopping a step further by taking itself to the customer
creating conveniences of shopping anywhere and at anytime.

 Reduced operational cost: Since the entire business can be moved online,
the need for physical stores has become obsolete. Less infrastructural
 investment and associated labour costs drives up the profit margin. The
seller can then transfer this benefit to the customer in the form of discounted
pricing which boosts the appeal of online shopping.

 Easy to compare: It is far easier and quicker to compare prices of goods

online, equipping the customer with the information to decide the right price
or terms for themselves. The comparison is not restricted to items from a
single seller, or a single region. One can explore products across global
markets via e commerce.

 Safe & secure:Customers can trust the process of going online and
purchasing only when transactions are fast, convenient and secure. A high
degree of integrity is possible only when the online electronic payment
provider is reputable and trustworthy. In India, all payment transaction
providers are required to comply with the security requirements laid out by
the Reserve Bank of India making the system more robust and reliable.

 Increased reach for the merchant: Just as the customer finds them able to
venture across geographic markets, the merchant too is able to display his
product to customers in new territories. Market penetration also becomes far
more achievable with e-commerce; it is possible for a merchant in Mumbai
to extend his reach to north-eastern cities or even rural villages that are now
connected by the online network.

 Social media trend: In India, with the increasing propensity of social media,
businesses have now begun to engage their customers on social networking
portals such as Facebook. Promotions, sales and new products are
 increasingly showcased through such channels and mobile apps are now
available that suggest products to users based on their profiles. These are
likely to be rapidly developing marketing channels for the future.

The e-commerce world is changing rapidly in the digitized world. These e-

commerce developments may have been accelerated by the global economic
downturn which may be driving consumers to find new ways of reducing their
costs of living. The online channel offers a clear value proposition for both
merchants and consumers making it the most sought after and exciting business
model today
Factors affecting influence distribution and forms of global e-commerce

Stage Economic and Socio cultural Political legal Supranational

infra structure factors factors institutions
related factors
Internet adoption Per capita Literacy rate and The internet's UNDP-
GDP computer skill democratic introduction of
Nature the
incompatible internet in
with many countries
authoritarian
political
Availability of English language structures GATS-
telephone and skill competition
computer in telecom
sectors
Pricing structure Viewed as a Tariff and non ITA- reducing
tool of tariff barriers to the price of ICT
cultural ICT products.
imperialism in products
some
Buying/selling Availability of Intellectual Redress UNCITRAL
online credit property mechanisms in model law
protection case of
problems in
online
transactions
Advertising and Operating speed Influence of Ban on some Products can be
searching phase of language and website in advertised and
symbols used on authoritarian searched
computer and
 modern size site visited and regimes globally on
purchase GTPN of
decision UNCTAD
Payment phase Penetration rate Forms of Governments' UNCTAD smart
of credit cards payment: concern on card
check, wire the outflow of
transfer, cash foreign currency.
on delivery
etc,
Delivery phase Delivery means Products stolen Tariff and non- Electronic
and some tariff delivery free
infrastructure countries barriers of custom
duties in WTO
member
Brief Literature Review
In present scenario E-Commerce is playing very essential role in the online business. Although it
is one of the best & cheapest intermediate for reaching out to new customers in the online
market, if e-commerce implemented effectively, it also offers a smart way of doing online
business & expanding it more.
An online business eCommerce podium is planned & implemented to make the most of its reach
to potential customers and provide them with a convenient, satisfying & protected shopping
experience.
Advantages of E-Commerce to the Online Business
 E-Commerce helps to Increase the sales revenue to the business
 Business people can spend less money and earn high profits with e-commerce
 It is very Easier to scale up online
 Easily we can track the segment of customers who are happy with purchasing goods
through online
 Avoid losing sales to competitors who are online
 Instantaneous global sales presence in quick time
 We can Operate the business in 24 *7 basis
 Easily we can increase our business customers
 We set up shop anywhere in the world, self-governing of geographical locations
 Inexpensive way to turn your Web site into a revenue center
 Reduce Customer Support costs via e-mail marketing & customary newsletters
 We can create customized mailing list
 Easily we can drive free traffic to the website
 Instantly we can develop our business across the internet by using various e-commerce
strategies
 Customers can easily buy their products by using different payment gateways
 Develop more shopping carts by using e-commerce
 We can easily promote our business website by using various promotional activities such as
Search Engine Optimization, Pay Per Click Management, Email Marketing, Social Media
Optimization, Online Banner Advertisement, Online Branding and Affiliate Management
etc
B2C - business to consumer

In the Australian context B2C (business to consumer) trading activity has been slow to
take off as at first consumers had doubts about the security of credit card transactions.

Initial B2C trading focused on music CDs, software and books - items which were
compact and easily shipped and where prices could be slashed once the retailer's cut was
taken out of the margin. The Amazon book store would be a good example of this. These
products pushed the perimeters of the market out for goods bought on-line.

Books and CDs are relatively generic products. A CD bought in the US will have the
same music and quality as one bought locally (the exception is the cover art) and so there
is no doubt in the consumers mind exactly what the product is. This is not the case with
clothing, where sizes can confuse the purchase decision... and where tactile senses figure
strongly in the purchasing decision.

Ebay has really transform purchasing behaviour on the web. Many people have made
their first ecommerce transaction on Ebay. Many people sell on Ebay too, given raise to
the work-from-home/drop shipping model of ecommerce.

Interestingly though B2C transactions of previously localised or hard to find products can
be extremely strong. If you have a unique product that is highly relevant to a niche
audience, you are likely to do very well on the web.

Although sales are increasing rapidly on the Internet, the volume of turnover figures
continue to fail short of industry estimates. But as retail web sites become more navigable
and privacy policies are displayed, more people will be drawn to Net-based purchasing
by lower prices and convenience.

B2B - business to business

On the Internet, B2B (business to business) is the exchange of products or services

between businesses rather than between businesses and consumers.
Although early interest centered on the growth of retailing on the Internet, forecasts are
that B2B revenue will far exceed B2C revenue in the near future.

According to studies published in early 2000, the money volume of B2B exceeds that of
B2C by 10 to 1. Over the next five years, B2B is expected to have a compound annual
growth of 41%.

Payment Gateways

Both PayPal and Paymate offer credit card to bank account payments. Using one of these
services you can invoice a customer, they can pay on Paymate and the funds will be
deposited in your bank account ... less a transaction fee.

Unlike a credit card merchant facility you will not have ongoing, minimum monthly
fees... and the transaction fee is better than what most card companies offer small
merchants. Additional these service are being backed into other ecommerce sites and
shopping carts. Ebay for example uses Paypal to process some payments.

The Rise and Rise of Auction Sites

Auction sites such as Ebay and TradeMe have done an enormous amount to get ordinary
people involved in online trading. Today many Ebay merchants are establishing their
own web sites to avoid Ebay and Pay Pal fees. They have learnt about how to present
their product in their Ebay store and what issues are important to their customers in
purchasing their product and now they are ready to start their own web site.

Security

On the Internet, security is handled by passing "keys" between Internet server and client
browser. When entering a secure site your browser is passed a public key by which
transactions between you and the web server are encrypted. The servers key is always
kept private.
On your web site security can be handled two ways - depending on your budget. You can
"piggyback" on someone else's "key" or you can register and pay for your own key or
SSL certificate at Thwate or Verisign.

Generally today businesses who host web sites offer access to a secure server and you
can use their server and secure certificate for less than if you registered and paid for your
own key.

However the person browsing your site will notice the URL change to one they do not
recognise - or trust. This may put your customers off (although there is no evidence of
this). Therefore one of the advantages of buying your own key would be to have a URL
for your secure pages that is consistent with the rest of your site.

Presently, in Australia, Verisign may sell you a key for over $800 while foreign
ecommerce providers like Instant SSL can sell it for $150. Although Verisign will argue
that their key comes with a range of value add benefits, the bottom line is the product, i.e.
the key, is the same.
 CHAPTER-III
SUMMARY AND CONCLUSION
 There is a wide acceptance of e-commerce in world due to the internet facilities available.
 The countries such as India, Brazil, and China etc which are on the path of development
are using e-commerce for carry out various transactions.
 The e-commerce can surpass geographical limits and can prove to be worthy by reaching
to customers. It caters to the demands of both the national and the international market.
 The e-commerce can help in providing an edge to your rivals in the market as one can
better serve them globally.
 The Countries such as USA, Australia, Canada , UK etc are trying to come up with
something innovative which will change the current scenario.
 The countries are well aware of its benefits and are becoming more innovative in this
field as customers can easily select products from different providers without moving
around physically and it also help business to handle its resources well.
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Newspapers
 Hindustan Times