Page 151 - Introduction to Electronic Commerce and Social Commerce

Discussion Questions 131

6. B2B reverse auctions. A reverse auction is a tendering managing, and servicing various partners and tasks, fre-
system used by buyers to get better prices from suppliers quently along the supply chain. C-commerce can be
competing to fulfill the buyers’ needs. Auctions can be conducted between different pairs of business partners
done on a company’s website or on a third-party auction or among many partners participating in a collaborative
site. Reverse auctions can lower buyers’ costs dramati- network. Collaboration with Web 2.0 tools and in social
cally, both in product costs and in the time and cost of networks adds a social dimension that could improve
the tendering process. communication, participation, and trust. There are many
7. B2B aggregation and group purchasing. Increasing new tools, some of which are being added to traditional
the bargaining power and efficiency of companies can collaboration tools. Better collaboration may improve
be done by aggregating either the buyers or the sellers. supply chain operation, knowledge management, and
Aggregating suppliers’ catalogs into a buyer’s catalog, individual and organizational performance.
for example, gives buying companies better control of
purchasing costs. In desktop purchasing, employees are
empowered to buy up to a certain limit without the need KEY TERMS
for additional approval. Employees view internal cata-
logs with pre-agreed-upon prices with the approved sup- Bartering exchange
pliers and then buy within their budget. Industrial malls Business-to-business e-commerce (B2B EC)
or large distributors specialize in one industry (e.g., Buy-side e-marketplace
computers) or in industrial MROs. They aggregate the Collaborative commerce (c-commerce)
catalogs of thousands of suppliers. A purchasing agent Collaborative hubs (c-hubs)
can place an order for parts or materials, and shipping is Company-centric EC
arranged by the supplier or the mall owner. Buyer aggre- Consortium trading exchange (CTE)
gation through group purchasing is very popular because Desktop purchasing
it enables even SMEs to get better prices on their pur- Direct materials
chases. In addition to direct purchasing, items can be Dynamic pricing
acquired via bartering. E-collaboration
8. Exchanges defined and the major types of exchanges. E-procurement (electronic procurement)
Exchanges are e-marketplaces that provide a trading Exchanges (trading communities or trading exchanges)
platform for conducting business among many buyers, Gamification
many sellers, and other business partners. Types of pub- Group purchasing
lic e-marketplaces include B2B third-party trading Horizontal marketplaces
exchanges and consortium trading exchanges. Exchanges Indirect materials
may be vertical (industry oriented) or horizontal. Maintenance, repair, and operation (MRO)
9. Third-party exchanges. Third-party exchanges are Maverick buying
owned by an independent company and usually are Online intermediary
operated in highly fragmented markets. They are open to Procurement management
anyone and, therefore, are considered public exchanges. Public e-marketplaces
They try to maintain neutral relations with both buyers Request for quote (RFQ)
and sellers. Reverse auction
10. B2B in Web 2.0 and social networks. Although con- Sell-side e-marketplace
siderable B2C social networking activities exist, B2B Social collaboration
activities are just beginning. A major success has been Vendor-managed inventory
seen in the use of blogs and wikis to collaborate with Vertical marketplaces
suppliers and customers. Large companies use social Virtual trade shows
networking to create and foster business relationships.
Smaller companies use social networking for soliciting
expert opinions. Other companies use it for finding busi- DISCUSSION QUESTIONS
ness partners, cultivating business opportunities, recruit-
ing employees, and finding sales leads. 1. Explain how a catalog-based sell-side e-marketplace works
11. C-commerce. Collaborative commerce (c-commerce) and describe its benefits.
refers to a planned use of digital technology by business 2. Discuss the advantages of selling through online auctions
partners. It includes planning, designing, researching, over selling from catalogs. What are the disadvantages?