E-Business and E-Commerce


Over the last few years, the modes of business have changed overwhelmingly. The electronic mode of business has taken over the leading role now. People now buy goods and services over the internet right from their homes with a mobile phone with internet services. The way business is managed is totally different from what it was in the traditional method for the last few decades. Let’s see how new modes of business have emerged as the new processes of buying and selling things.

What is E-Business?

Named by the marketing and internet team of Intel in 1996, E-business is a mode of business where transactions, business activities, and services take place online. The buyer and seller don’t have to face each other in this mode of business. The process relies on digital methods and the transactions happen digitally where the payment is made via an online banking process. Therefore, it is a mode of business where digital payments make way for buying and selling goods and services.

Characteristics of E-Business

E-businesses have some unique characteristics which are as follows −

Easy setup − It is easy to set up e-businesses. One just needs a website and digital banking-enabled payment gateway to engage in it.

No geographic barriers − As e-businesses are operated online via the internet, there is a barrier to geographies in it. Customers from anywhere can buy anything from the business any time they wish.

Cost efficient − E-businesses are a cost-efficient mode of business because they save enough money that would have been required if a physical location had to be opted for the business.

Flexible timing of business − E-businesses can be done any time and from anywhere. There is no limit on timing as it can be operated 24 hours a day 365 days a year.

Cheap marketing − E-businesses don’t require elaborate marketing. The costs required are only spent on digital marketing which is cheaper than traditional modes of marketing and advertising.

No interaction between buyer and seller − In an e-business, no interaction is needed between the seller and the buyer. Transactions and transfers occur online. The payment is done electronically and the order is shipped to the consumer’s address by the seller.

Delivery takes extra time − As the seller may be situated far from the buyer, an extra amount of time may be required to get the items delivered in e-businesses.

The threat of transaction − The transaction threat is more prominent in the case of e-businesses as hackers may access banking data and steal money from the accounts digitally.

Customers may be situated anywhere, they may buy anything and the process can occur at any time the consumer wishes.

Advantages of E-Businesses

Some of the most notable advantages are the following −

Less costly − E-businesses need only a website and software which cost less than the establishment of a traditional business. So, e-businesses are pocket friendly.

Easy to organize − Online businesses can be set up at home with minimum requirements of internet, website, and a few software.

Lack of geographic barriers − There is no barrier of geography to e-businesses. They can sell things worldwide. Customers can be located anywhere in the world. The only requirement is that the customers should have internet and digital payment modes available to them.

Government subsidies − Governments promote and help e-businesses because they promote digitization. Digitization makes payments transparent and this helps governments keep track of payments easily.

Flexible timing − There is no fixed working hour for e-businesses. They can be operated round the clock and consumers may reach the site any time from anywhere. There is no need for anyone to stay available from the seller’s end. The process gets done automatically without any errors.

Disadvantages of E-Businesses

Following are the most notable disadvantages of e-businesses −

Lack of interpersonal communication − Unlike traditional businesses, e-businesses do not have one-to-one communication. This may lead to the inability to properly judge the quality of products. Moreover, as there is no personal connection, it is hard for the business to develop trust with the consumer.

Delivery time − In traditional business, we get the product delivered immediately after payment. However, in the case of e-business, it takes extra time for the product to reach the consumer.

More risks − As hackers can easily get consumers’ banking details online, e-businesses are considered riskier than traditional methods.


E-commerce or electronic commerce is the mode of business where transactions take place via the Internet, and things are delivered to the consumer’s address by the seller.

Buyers do not face sellers in this kind of business.

Types of E-Commerce

Business-to-Business (B2B)

In this type of e-commerce, the buying and selling of goods and services occur between businesses. Usually, manufacturers and wholesalers operate with this kind of electronic commerce. Examples include Alibaba, Qualcomm, etc.

Business-to-Consumer (B2C)

Here, the goods are sold by the business to the customer. Examples of B2C businesses include Intel, Dell, etc.

Consumer-to-Consumer (C2C)

The C2C business is done between customers to customers. Some examples include OLX, Quickr, etc.

Consumer-to-Business (C2B)

In this type of business, the transaction happens between customers to the business.


When a company outsources, it makes another company or firm responsible for the part of businesses that have been outsourced. Usually, companies outsource their non-core activities to specialized agencies that are more capable of doing the business.

Outsourcing is growing rapidly because of its cost advantage and the value addition the process adds to the whole process of the business.

Advantages of Outsourcing

Some of the key advantages of outsourcing are as mentioned below.

  • Cost efficiency − There is no need to hire anyone permanently. Hiring costs go down as no training is required. Labor costs go down as outsourcing can be done to less-costly agents in a different country where skilled labor is available at a lower cost.
  • Increment in performance − As outsource-oriented agencies are more efficient in given tasks, the performance of the company that outsources goes up due to outsourcing.
  • Low investment − The outsourcing company has to incur less cost for the services than what it will have to incur if it is done by the company itself.
  • Resultant high quality of work − The work done by outsourcing-oriented companies is high in quality which increases the productivity of the outsourcer.

Disadvantages of Outsourcing

  • Lack of quality − Sometimes, the work done by the outsourcing agency is lower in terms of quality which consumes time and costs for the outsourcing company.
  • Security threat − As there are chances of confidential data getting leaked, there are security threats in the outsourcing process.
  • Lack of communication − As there is a lack of communication between the outsourcer and outsourced agency, there may be disagreement in many steps leading to wastage of money and time.


The emerging world is full of potential if we talk about the new modes of business. These new modes are fostering economic growth and helping globalization to spread far and wide. However, care must be taken in carrying out the business processes because they are very new and many threats and dangers are still unknown.


Qns 1. Name three emerging modes of business.

Ans. E-business, e-commerce, and outsourcing are three new and merging modes of business.

Qns 2. Who coined the term ‘e-business’?

Ans. In 1996, Intel’s marketing and internet team coined the term “E-business”.

Qns 3. What is the most glaring disadvantage of e-businesses?

Ans. The most notable disadvantage of e-businesses is the security threat. As digital banking data can be accessed by hackers, there is a chance of theft which is more prevalent in e-businesses.

Updated on: 13-Oct-2022

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