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Five last articles
  • Building a Web Store on Shoestring Budget in less than Four Hours

  • Thursday, May 12, 2005
  • Effective Web Search with Google's "My Search History" Tool

  • Monday, April 25, 2005
  • Beware of Spyware

  • Thursday, April 7, 2005
  • How to Build a Business Website

  • Tuesday, March 22, 2005
  • Effective use of your online time

  • Saturday, March 5, 2005
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    E-marketplace - Facts and Fictions Sunday, March 30, 2003
    E-marketplace - Facts and Fictions

    Not long ago, industry pundits were touting B2B marketplaces or exchanges as Internet era panacea for productivity and cost-cutting problems of corporate world. Buoyed by excessive investor interest and driven by a desire to cash in on the enormous dot-com valuations of late 90s, marketplaces were sprouting like autumn mushrooms. With the collapse of stock market, it did not take much time for burgeoning B2B marketplaces to come to a screeching halt!

    When in 2001 high profile marketplaces like Chemdex, a life science marketplace started to tumble down, and most of the marketplaces started to show sign of disappointing growth rate, it became clear that something is wrong with the prevailing business model of b2b e-marketplaces.

    Optimists claim nothing is wrong with B2B e-marketplaces, as a new technology, it is merely going through the normal evolutionary stages. Others feel that business processes are way too complex an issue, substantially based on human behavior and intricate relationships; and this complexity will prevent wide spread implementation of online supply chain mechanisms through B2B exchanges.

    But, the truth is probably somewhere in between! There is no doubt that any business, irrelevant to its size, is able to create some sorts of value if they use B2B marketplace effectively. As far as B2B E-commerce is concerned, most agree, that eventually businesses have to do significant part of their transactions online. The only thing is - it might take a bit more time for widespread adoption, than initially expected.

    Slow implementation of B2B e-marketplaces is a natural consequence of some inadvertent stumbling blocks.

    1. The investment in B2B sector started to dry up at the end of 2001 as unrealistic expectations of many investors and funds did not materialize. As a result of this, many exchanges were forced to close down; and much needed transformation in the technology process slowed down in existing ones due to liquidity challenges.

    2. Many early marketplaces were built in a hurry to exploit prevailing at that time budding stock market. For these marketplaces, value creation for the participants was not a priority. By the time they realized that members need something more than comparison shopping and product display ability, it was a bit too late for quite a few of them.

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    3. Contrary to popular believe, buyers did not start flocking on to the e-marketplaces as expected. As it became clear, buyers require real incentives in order to go through the complex process of online dealing. In most cases, in order to get integrated to an e-marketplace, buyers are ready to learn, hire professionals, and invest on technology if they know that most of their offline suppliers are available on a particular exchange. But, until then, they prefer to refrain from changing their way of doing business.

    4. There are number of reasons why suppliers don't expedite the process either. They are mainly scared of comparison shopping and brand dilution. Complexity of back end office integration and product catalog conversion also creates major impediment in mass adoption of e-marketplaces within the supplier community. Suppliers with websites, who previously had disappointing e-commerce experience, are also quite skeptical about the benefits that they might achieve from exchanges.

    5. Many exchanges' revenue depends on the percentage-based transaction fee, imposed upon the participants. Some companies consider that these fees will reduce their net profit margin, especially, in a down market. This is another cause, why many are not very keen to participate in e-marketplaces.

    All these conditions are maybe right and, probably mass scale adoption of e-marketplaces won't take place another several years. However, don't think that companies should relax. As some industries are more advanced in their adoption of B2B technology, companies should constantly check where they stand. If their competitors are already practicing e-business actively; or many of their suppliers are by now on some sorts of exchanges, this is the right time for these companies to consider their online business approach seriously.

    The sooner companies understand the benefits that they can reap from B2B exchanges the better it would be for them. For suppliers e-marketplaces offer benefits like liquidity improvement, cost savings, better inventory management, demand forecasting, dynamic pricing etc. Buyers benefits include: cost reduction, real-time purchase, best available price and many others. Research indicates that companies, thanks to B2B exchanges, can gain remarkable cost reductions: 20 to 40 percent of overhead expenses, 5 to 15 percent of buying cost, Purchase Order processing cost from US$ 75 to just US$ 6-8; and decrease of document errors from 20 percent to less than one percent.

    Apart from these benefits, early adoption of B2B marketplaces also has great implications for companies. Early birds get considerable information advantage over their competitors; have enough time to learn from trial and error and participate in setting the rules for the exchanges as opposed to - forced to abide by the rules as it would be the case for late-comers.

    Whatever approach the companies decide to take in their quest of B2B technology, one thing is for sure that the e-marketplaces are here to stay. Over time, they will definitely evolve and their business models will also change, however, there is no doubt that a major portion of e-business will transact through e-marketplaces in near future.

    Nigerian scam Monday, March 10, 2003
    Dear members,

    We decided to dedicate this issue of our Newsletter to some of the burgeoning Internet scams that you are encountering lately in a massive scale, especially, the Nigerian scam.

    Almost everyday you probably get a number of various scam emails. Since the quantity of such emails are increasing constantly and the con artists even register with Rusbiz portal and use our internal messaging system for their malevolence purposes, we have outlined here one of the most popular scams under the name of Nigerian Scam and what this is all about.

    If you have suggestions and ideas regarding similar internet scams and you would like to share with other members, feel free to write us.

    Enjoy the great spring out there!

    Sincerely yours,

    Nowshade Kabir

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    Nigerian Scam

    Although this scam has its root from Nigeria dated a decade back, nowadays, you receive similar scam letters from many African countries, notably, Nigeria, Benin, Togo and even South Africa.

    The subject lines of these emails are pretty similar. Something like: Business relationship, Urgent Assistance needed, Soliciting for your assistance, A cry for help etc. Most of the emails from this scam begin in the same way. Here are two excerpts from most recent emails that we received:

    "I am Engr Moses Ekpen a director in the budget and planning department of the Federal Ministry of Petroleum and Natural Resources (FMPNR), I had a seven man Tenders Board Committee in charge of contract award and Payment approvals. I came to know of you in my search for a reliable and reputable person to handle a very confidential transaction, which involves the transfer of a huge sum of money to a foreign account."

    Or

    "I am Mrs. Mariam Abacha, the widow of Gen. Sani Abacha, The Late Nigerian Military Head of State. You were introduced to me through the Chamber of Commerce. I am presently in distress and under House arrest while my son Mohammed is undergoing trial in Lagos and Abuja. He is presently detained in prison custody. The government has frozen all the family account and auctioned all our properties.

    To save the family from total bankruptcy I have managed to ship to Europe and Asia through a Shipping company, the sum of US20, 000,000.00 respectively kept by my late husband."

    The essence of these emails are also basically the same the person although does not know you, thanks to your business reputation, has decided to contact you with a very confidential proposal to transfer a mind boggling amount of money from his country to any foreign land.

    There could be numerous stories but the bottom line is they require your help to transfer the amount. For your service they will promise you something from 10 to 40% of the whole amount. There would be a telephone no or an email address to contact the person.

    You may wonder how they swindle people.


    There are various ways that the crooks rip off their victims. Some of the most commons ones of them are described below:

    They will ask you to open a bank account under their name. On their second step, they will ask you to deposit a sum of say US$ 10000 to that account, explaining if the account does not have any decent amount, the officials those who are responsible for transferring the promised millions of dollars would become suspicious and wont authorize the transaction. Once you deposited the asked sum, they simply withdraw it and disappear. Usually they choose a bank where they might have some connections. So you, after losing your money, do not get any help from the bank either.

    They will ask you to send some merchandize or gifts for the officials they need to bribe in order to make the transactions of the assumed millions of dollars smoothly. Naturally, you never hear from them once you sent the requested gifts to their address.

    We even heard stories like this one: A man was persuaded to come to Nigeria to look after the transaction by himself. Over there he was kept hostage until he shifted all his liquid assets to the thugs.

    Looking at the increasing quantity of scam emails that we receive, this only convinces that many fall for this seemingly simple trap. According to FBI these swindlers have defrauded millions of dollars from gullible people.

    There could be other variations of this scam, next time you read an email that feels suspicious, just delete it! There are other ways of making money!

    Some words of cautions! Although most of these scams originate from African countries, please do not generalize and consider that all companies form these countries are bad. As usual a few people are responsible for tarnishing the reputation of a country.

    Effective methods of doing business online! Monday, March 10, 2003

    With all these dot com failures so rampant, you may question, is it still viable to consider an online venture? The truth is: while spectacular rise and fall of many dot com companies have been overly publicized, sales through Internet are still increasing by 20 25% each year. Even economic down turn of the recent years has not hampered this growth.

    Consider this:

    According to an annual study of Internet trends by marketing research firm Ipsos, almost two third of Internet users in the United States have by now purchased a product or service online. Thats a dramatic increase from only 36 percents of respondents in 2000. Studies show that more than 35.5 million U.S. Internet users made shopping trips to web shops during the week ending November 3, 2002, which is roughly 14 million more than almost the same time period in 2001.

    While the hype over the new economy is maybe over, one thing is for sure that Internet has revolutionized the way we do business and positioned itself as one of the biggest and most unique sales channels. Many companies, finally, started to realize that their very existence may get jeopardized if they are slow in integrating Internet to their business model.

    But the question still remains - is there any effective method of doing business online?

    Below I have outlined some components crucial to any online venture. While these might not be the only vital components of web based business, understanding them correctly will significantly improve your chance of doing online business effectively.

    Business Plan

    Business plans are like road maps. Imagine, you ended up in a unfamiliar town and you have to find an address without a map! How would you feel? Definitely, you would have been much better off with a map of the locality! The same thing goes for business plan. Though, many successful ventures may have been started without the benefit of a formal business plan, a good business plan improves your chances of success and help you avoid many mistakes.

    A recent AT&T study of successful entrepreneurs shows that businesses are more successful if they have a written business plan than the ones which dont. With a written business plan you get a better picture of your planned venture. So, before starting you online venture, take some time and write down what are you planning to do.

    Product or Service

    If you are a brick and mortar company merely trying to expand sales of your products or services on the Internet your task is easier! You at least dont have to mull over what to sell. But, what an entrepreneur who decided to start a new venture should sell on the Internet?

    Actually, you can sell virtually any product or service through the Internet. You may say, "Wait a second, you cant sell big ticket items over the net, right?" Wrong! The car and part industries alone forecast to generate US$ 274 billion in revenues from online trade by 2004. There are incidents of consumers buying corporate jets online!

    If you are serious about starting an online business, finding a product or service that suits you should not be very difficult.

    Knowledge base products like e-books, how-to-reports and hard to find information and data sell quite well on the Internet.
    Drop-ship items are bountiful on the Internet.
    Thanks to global reach of Internet finding manufacturer for any item that you plan to import to your country or export from your country became lot easier.
    If you have expertise, online services similar to web design, travel arrangement etc. are also good sales.
    Internet users are paying readily for various types of online contents. Global online content market will add up to 50 billion US$ in 2003. You can consider this too!

    Website/ Web store

    Since you customers take their decision, whether to do business with you or not based on what they see on your site, it is critical to have a professional-looking website with good related content.

    You can choose your website according to your need from a vast range of choices. Starting from a completely free website you can shell out thousands of dollars for a decent e-commerce website. The choice is yours!

    There are various quality portals that allow you to have products and services displayed on a single page web site for free. Many business to business portals provide with this kind of services. However, for real time transactions you will still need e-commerce web stores.

    If you are not good at design or dont want to spend a fortune on you web store, you should think about getting an e-commerce stores from web enablers like Yahoo, Bigstep, etc.

    For a nominal monthly fee you can have the facilities required to run a full fledged electronic storefront and build it yourselves from easy to use templates.

    If you go for this type of services, compare and see who has most of the features for lesser price. Some business to business portals along with your e-business web store will furnish you with necessary features to carry out over the Internet many important parts of buy and sale processes.

    Shopping carts

    The integral part of e-commerce sites, which allows you to accept product purchase orders for multiple products or services, is called a shopping cart.

    The term "Shopping Cart"is taken from real life shopping terminology to help users understand the actions available to them. Like in a supermarket a user can add products to shopping cart, remove products from the cart or adjust the quantity of the products as per requirement before checking out and making payments.

    While looking for shopping carts for your e-commerce store, you should consider the following aspects of a powerful and functional shopping cart:

    Access to the shopping cart should be clearly visible. There should be several entry points to the cart.
    Add, remove and adjust quantity of the product features should be prominent on the cart page.
    The item name should have a link to the description of the product.
    There should be a way of saving items for future purchases.
    Shipping and other costs should be clearly stated before the check out process starts.
    Order forms should be simple and clear.
    All payment options should be explained clearly.
    Ordering process should be done through secure server. You know you are on a secure server when the URL of your browser indicates "https:". The s at the end of http stands for "secure".

    Merchant Account

    90 percents of all online retail sales take place through credit card transactions. According to industry statistics, the average credit card sale is $40 versus just $9 for the average cash sale. To offer the credit card payment option to your online clients, you need to set up a merchant account-a bank authorized account established by your company to receive the proceeds of credit card purchases.

    Even if you already accept credit cards for your offline transactions, that may not be enough. Although, you can take many precautions to reduce online credit card frauds, credit card companies still consider Internet transactions to be riskier than offline transactions. Thats why finding a right merchant account provider could be a little bit more complicated than you might think. Things could be even trickier if your business is located outside of the United States.

    There are many middleman merchant account providers on the Internet. Do some comparison-shopping before you sign up with any of them as conditions that they offer vary significantly.

    Although, it is definitely good to have a merchant account that does not mean you cant sell products or services without having one! There are numerous other payment options available on the Internet. Most popular of them are paypal, e-gold, e-bullion, etc.

    If you would like to have an effective online business, remember that old values still count. Proper planning, uncompromising customer service, integrity, hard work and persistence eventually will make your business successful.

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