International Retailing and E Commerce - Review

Internet and E Commerce has thrown open unimaginable opportunities for every kind of business. In terms of International Retail industry be it Grocery Selling or Fashion Retailing, the Companies have no option but to get into the race and of offering online shopping as a trade channel. As on date many companies have put up websites and some have offered online transactions to the customers. Online shopping has caught on with websites like Ebay.com and Amazon which have been set up as pure E Commerce portals. However in case of Companies that are already operating Stores, the online shopping is but an alternate channel. Though E Commerce is catching up, Retail companies are yet to gain the required experience and history to be able to develop the channel.

It has been recognised by the Industry Experts and Academicians that E Commerce helps increase the Company’s economic efficiency. First and foremost it helps overcome the physical distance and time barrier, making it possible for people to log in from home and place orders online. Secondly the operational costs towards transaction as well as distribution is reduced as compared to traditional shopping.

However, the E commerce with reference to Retail is yet to emerge with a definite roadmap. Today Companies are finding E commerce a challenge in the absence of a proven framework and model.

The challenge for E commerce as a model is to find alternative methods to address the facilities provided by the Company in the traditional selling mode. In the traditional mode the customer gets a shopping experience which is not replaceable in a virtual world. Traditional model offers choice of payments as well as immediate delivery that the customer can carry with him. Further product displays, sample testing as well as proven process for returns, warranty management need to be addressed satisfactorily through E Commerce.

Though the retailers have offered online shopping to the customers, it is seen that the Companies are yet to gear up in terms of technical and system expertise as well as back end operations. A recent survey of Retail websites in UK has brought out the issues underlining E-commerce models. Out of the 102 websites, one third was seen to have been problematic with regard to online shopping transactions. System glitches accounted for 17 percent of orders being unfulfilled. The other reasons such as Non availability of stock, Orders not picked and late deliveries too accounted for the negative performance of the E Commerce model.

However the fact is that E Commerce is here to stay and with increasing volumes the Retailers will have no choice but to focus on building the E commerce channel and investing into it in terms of required finances as well as system expertise. With more and more people getting on to the internet mode of shopping, the demand on the Retailers to come up with better E Commerce model is going to increase. The fact that E Commerce model’s operations are completely different from the physical retailing model makes it difficult for the Retailers to manage inventory and back end order picking process for both the streams at once. Until such time that the E Commerce channel volume builds up, Retailers have no option but to operate a common operations stream and process for both the channels i.e. E Commerce as well as Physical |Traditional selling. When the E trading volumes build up, the demand for separate inventory and fulfilment centre is justified.