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E-commerce Business Model in India


The world is digitizing and so are our needs to obtain various objects & things of daily use. As the economy is translating itself into a virtual interface of transactions, the need for being physically present to trade is becoming redundant. Therefore, Worldwide E-commerce business model is in a structure whose ‘E’ denotes Electronic. Such a type of model brings communities closer. It enables an individual, Firm or a Company to Trade in goods & services through or Via Internet.

The fast pace 3G & 4G services along with WIFI enabled centers has revolutionized the E-commerce model of doing business phenomenally.

Globally, it has taken the world by storm & people are invoking themselves to evolve new ideas pertaining to E-commerce. It has also contributed to the creation of a huge chunk of employment opportunities worldwide.

There are 4 types of E-commerce models Illustrated in the following diagram:

  1. Business to Business (B2B)
  2. Business to Consumer (B2C)
  3. Consumer to Consumer (C2C)
  4. Consumer to Business (C2B)

Any sort of Goods can be purchased or services can be availed through this medium or mechanism within a click or a second time frame.

Successful Examples of such E-commerce business models:

  • Target
  • Amazon
  • Alibaba
  • eBay or Etsy
  • Taboo
  • Flipchart
  • Snap deal

The market has widened in such a way that even buyers & sellers both are getting aligned as merchants for fetching work & even creating a chain for the distribution network. The transactions through e-commerce are generally effected by Computer, Tablets & Smartphones.

Advantages of an E-Commerce Model:

  • NIL time foundation
  • Variety of options
  • Swift delivery
  • Universal payment mode acceptability
  • Prompt Settlement of Transactions
  • Worldwide accessibility

Disadvantages of an E-Commerce Model:

  • Virtual Base
  • Intangibility of Goods
  • No instant Gratification
  • Customer Satisfaction issues

How Does It Work?

In order to start an E-commerce business, one must have a business acumen & model in mind to convert that idea into reality.

There are two ways to which one can be into the E-commerce trading scenario

A). Starting an e-commerce website.

B). Aligning with an established marketplace.

However, here we are liable to discuss implications of an E-commerce business model which operates worldwide. How is it getting the necessary licenses to operate out of its resident country? What are the permits needed to import-export code which are to be dispatched to meet the consumer demands?

We shall obviously this trivial issue of world permit in our upcoming blog.

Further following are the key steps for holding & setting up of an E-commerce model:

  • Company or LLP Registration.
  • Creation of a Business Model & Website
  • Consumer base development
  • Establishing marketing gimmicks
  • GST, PAN & TAN Registration
  • Bank Account opening
  • Establishment of a Payment Gateway
  • Going Live with business

Learning to build an online store is a daunting task for learners. But once the handling & precision is established this particular segment of doing business holds success beneath.

Website development[1] & App configuration in an accurate manner must be rule key to such a business model. However, the consumer base should also be selected accordingly, it should reach out to the masses.

Overall, in early 2000 E-commerce was in its inception but it has largely taken over the world community by storm.

Narendra Kumar

Experienced Finance and Legal Professional with 12+ Years of Experience in Legal, Finance, Fintech, Blockchain, and Revenue Management.

Business Plan Consultant

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