E-commerce is the activity of buying or selling of products on online services or over the Internet. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange, inventory management systems, automated data collection systems. Modern electronic commerce uses the World Wide Web for at least one part of the transaction's life cycle although it may use other technologies such as e-mail. Typical e-commerce transactions include the purchase of online books and music purchases, to a less extent, customized/personalized online liquor store inventory services. There are three areas of e-commerce: online retailing, electric markets, online auctions. E-commerce is supported by electronic business. E-commerce businesses may employ some or all of the followings: Online shopping for retail sales direct to consumers via Web sites and mobile apps, conversational commerce via live chat and voice assistants Providing or participating in online marketplaces, which process third-party business-to-consumer or consumer-to-consumer sales Business-to-business buying and selling.
A timeline for the development of e-commerce: 1971 or 1972: The ARPANET is used to arrange a cannabis sale between students at the Stanford Artificial Intelligence Laboratory and the Massachusetts Institute of Technology described as "the seminal act of e-commerce" in John Markoff's book What the Dormouse Said. 1979: Michael Aldrich demonstrates the first online shopping system. 1981: Thomson Holidays UK is the first business-to-business online shopping system to be installed. 1982: Minitel was introduced nationwide in France by France Télécom and used for online ordering. 1983: California State Assembly holds first hearing on "electronic commerce" in Volcano, California. Testifying are CPUC, MCI Mail, CompuServe, Volcano Telephone, Pacific Telesis. 1984: Gateshead SIS/Tesco is first B2C online shopping system and Mrs Snowball, 72, is the first online home shopper 1984: In April 1984, CompuServe launches the Electronic Mall in the USA and Canada. It is the first comprehensive electronic commerce service.
1989: In May 1989, Sequoia Data Corp. Introduced Compumarket, the first internet based system for e-commerce. Sellers and buyers could post items for sale and buyers could search the database and make purchases with a credit card. 1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer. 1992: Book Stacks Unlimited in Cleveland opens a commercial sales website selling books online with credit card processing. 1993: Paget Press releases edition No. 3 of the first app store, The Electronic AppWrapper 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Netscape 1.0 is introduced in late 1994 with SSL encryption. 1994: Ipswitch IMail Server becomes the first software available online for sale and immediate download via a partnership between Ipswitch, Inc. and OpenMarket. 1994: "Ten Summoner's Tales" by Sting becomes the first secure online purchase through NetMarket. 1995: The US National Science Foundation lifts its former strict prohibition of commercial enterprise on the Internet.
1995: Thursday 27 April 1995, the purchase of a book by Paul Stanfield, Product Manager for CompuServe UK, from W H Smith's shop within CompuServe's UK Shopping Centre is the UK's first national online shopping service secure transaction. The shopping service at launch featured W H Smith, Virgin Megastores/Our Price, Great Universal Stores, Dixons Retail, Past Times, PC World and Innovations. 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24-hour, internet-only radio stations, Radio HK and NetRadio start broadcasting. EBay is founded by computer programmer Pierre Omidyar as AuctionWeb. 1996: The use of Excalibur BBS with replicated "Storefronts" was an early implementation of electronic commerce started by a group of SysOps in Australia and replicated to global partner sites. 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web. 1999: Alibaba Group is established in China. Business.com sold for US $7.5 million to eCompanies, purchased in 1997 for US $149,000.
The peer-to-peer filesharing software Napster launches. ATG Stores launches to sell decorative items for the home online. 1999: Global e-commerce reaches $150 billion 2000: The dot-com bust. 2001: Alibaba.com achieved profitability in December 2001. 2002: eBay acquires PayPal for $1.5 billion. Niche retail companies Wayfair and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal. 2003: Amazon.com posts first yearly profit. 2004: DHgate.com, China's first online b2b transaction platform, is established, forcing other b2b sites to move away from the "yellow pages" model. 2007: Business.com acquired by R. H. Donnelley for $345 million. 2014: US e-commerce and Online Retail sales projected to reach $294 billion, an increase of 12 percent over 2013 and 9% of all retail sales. Alibaba Group has the largest Initial public offering worth $25 billion. 2015: Amazon.com accounts for more than half of all e-commerce
Procurement is the process of finding and agreeing to terms, acquiring goods, services, or works from an external source via a tendering or competitive bidding process. Procurement is used to ensure the buyer receives goods, services, or works at the best possible price when aspects such as quality, quantity and location are compared. Corporations and public bodies define processes intended to promote fair and open competition for their business while minimizing risks such as exposure to fraud and collusion. All purchasing decisions include factors such as delivery and handling, marginal benefit, price fluctuations. Procurement involves making buying decisions under conditions of scarcity. If sound data is available, it is good practice to make use of economic analysis methods such as cost-benefit analysis or cost-utility analysis. An important distinction should be made between analyses without those with risk. Where risk is involved, either in the costs or the benefits, the concept of best value should be employed.
Procurement activities are often split into two distinct categories and indirect spend. Direct spend refers to the production-related procurement that encompasses all items that are part of finished products, such as raw material and parts. Direct procurement, the focus in supply chain management, directly affects the production process of manufacturing firms. In contrast, indirect procurement concerns non-production-related acquisition: obtaining “operating resources” which a company purchases to enable its operations. Indirect procurement comprises a wide variety of goods and services, from standardized items like office supplies and machine lubricants to complex and costly products and services like heavy equipment, consulting services, outsourcing services. Procurement is one component of the broader concept of sourcing and acquisition. Procurement is viewed as more tactical in nature and sourcing and acquisition are viewed as more strategic and encompassing; the Institute of Supply Management defines strategic sourcing as the process of identifying sources that could provide needed products or services for the acquiring organization.
The term procurement used to reflect the entire purchasing process or cycle, not just the tactical components. ISM defines procurement as an organizational function that includes specifications development, value analysis, supplier market research, buying activities, contract administration, inventory control, traffic and stores. Purchasing refers to the major function of an organization, responsible for acquisition of required materials and equipment; the United States Defense Acquisition University defines procurement as the act of buying goods and services for the government. DAU defines acquisition as the conceptualization, design, test, production, Logistics Support and disposal of weapons and other systems, supplies, or services to satisfy Department of Defense needs, intended for use in or in support of military missions. Acquisition and sourcing are therefore much wider concepts than procurement. Multiple sourcing business models exist, acquisition models exist; the revised acquisition process for major systems in industry and defense is shown in the next figure.
The process is defined by a series of phases during which technology is defined and matured into viable concepts, which are subsequently developed and readied for production, after which the systems produced are supported in the field. The process allows for a given system to enter the process at any of the development phases. For example, a system using unproven technology would enter at the beginning stages of the process and would proceed through a lengthy period of technology maturation, while a system based on mature and proven technologies might enter directly into engineering development or, conceivably production; the process itself includes four phases of development: Concept and technology development is intended to explore alternative concepts based on assessments of operational needs, technology readiness and affordability. The concept and technology development phase begins with concept exploration. During this stage, concept studies are undertaken to define alternative concepts and to provide information about capability and risk that would permit an objective comparison of competing concepts.
The system development and demonstration phase could be entered directly as a result of a technological opportunity and urgent user need, as well as having come through concept and technology development. The last, longest phase is the sustainable and disposal phase of the program. During this phase all necessary activities are accomplished to maintain and sustain the system in the field in the most cost-effective manner possible. Procurement officials realize that their make-buy supplier decisions fall along a continuum from simple buying transactions to more complex, strategic buyer-supplier collaborations, it is important for procurement officials to use the right sourcing business model that fits each buyer-seller situation. There are seven models along the sourcing continuum: basic provider, approved provider, preferred provider, performance-based/managed services model, Vested business model, shared services model and equity partnerships. A basic provider model is transaction-based; these products or services are available, with little differentiation in what is offered.
An approved prov