The Advantages of an E-commerce Website Business

E-commerce websites let customers shop from anywhere they have Internet access.

Businesses used to be entities that bought a store front, filled it with merchandise, and hired employees to help customers with the process of purchasing that merchandise. While many businesses still fit this model, the Internet has introduced a new business model with many advantages over the brick-and-mortar store: the e-commerce website business.

Cyberspace Location

One of the major advantages of an e-commerce website business is that business owners do not need to invest in retail locations. The storefront is in cyberspace, so there is no need to lease a location with the appropriate zoning certification, spend money furnishing the location to look like a professional environment, or pay the costs associated with electricity, insurance, and everything else that comes with owning a store. All the owner of an e-commerce website business needs is an office, a space for servers if his business is large enough to warrant purchasing his own server equipment, and a facility to package the products customers purchase online. This saves a great deal of money on overhead costs.

Employees

Unlike traditional brick-and-mortar stores which require employees to act as salespeople, customer service representatives, and shipping-and-receiving personnel, the e-commerce website business requires a much smaller staff. Because the website interface handles the direct interactions with customers and can accommodate a large number of customers at a single time, e-commerce businesses do not need a large sales staff. They can make do with a staff large enough to package and ship orders that customers place on the website, IT people to keep the website up and running, and a support staff that business owners can scale to the size of the current traffic on their website, rather than the fixed size of a store.

Reach

Whereas brick-and-mortar stores have a fixed customer base of people who live within driving distance of the particular location, e-commerce website businesses do not have any such limitation. Anyone with an Internet connection who lives in an area to which the owner of the e-commerce business is willing to ship products can become a customer by just visiting the website. This permits an e-commerce business to have a customer base as wide as the geographic area where it sends purchases.

Hours

Managers of brick-and-mortar stores calculate the operating hours of their stores by comparing the fixed costs for having the store open -- such as the power usage and the wages of everyone working during those hours -- with the number of customers they expect to come through and how much money they are likely to spend. E-commerce website businesses have no such limitations. While their packaging staff may only work during certain hours of the day, customers can log onto the website during any hour of the day or night to place orders and generate revenue for the business.

References

• "The New York Times"; Small Merchants Gain Large Presence on Web; Bob Tedeschi; December 2007
• "The New York Times"; A Gimmick Becomes a Real Trend; Bob Tedeschi; November 2007
• EcommerceEducation.com: Benefits of Ecommerce