RBSE Class 11 Business Studies Notes Chapter 9 Recent Trends of Business

Rajasthan Board RBSE Class 11 Business Studies Notes Chapter 9 Recent Trends of Business

E-Commerce

A commercial transaction implemented by a firm, with the help of which customers and suppliers exchange products, services or information.
It is a general term in which such commercial transaction implemented on electronic
medium are included, with the help of which customers and suppliers exchange products, services or information.
It is a synthesised form of communication technology and information that is involved in business transactions.

Types of E-Commerce

Business to Business E-Commerce (B2B)
Business to Customer E-Commerce (B2C)
Consumer to Business E-Commerce (C2B)
Consumer to Consumer E-Commerce (G2C)
Business to Government E-Commerce (B2G)
Digital Middlemen E-Commerce

Electronic Business

E-business, which is but a form of e-commerce, means conducting business on the internet.
Apart from selling and buying, it also includes providing services to buyers and co-operating with business partners.
The term E-business was first used in 1997 by IBM to expand its business.

Difference between E-business and E-Commerce

E-business is an extensive form of e-commerce. The sphere of e-business is more extensive as compared to e-commerce.
E-business includes sale-purchase, providing services to customers and co-operating with business partners, while e-commerce includes some other things like transactions. on www and Internet, electronic fund transfer, smart card, digital cash.

Advantages of E-Commerce

Due to E-Commerce, there is an extensive reach, it extends to international level and it helps in getting information about the new markets.
Companies are getting success in attracting their customers by providing them the latest information about products on web portals.
E-business takes less.time because the distribution mediums for products are reduced and the customers can be contacted directly.
While doing business through e-commerce, investment is considerably reduced,
because the products do not have to be stored in godowns, more employees are not needed and the expenditure is also low.
It becomes easier to reach a large number of and a variety of customers through e- commerce and to find new markets.

Limitations of E-Commerce

It does not involve direct and personal contact with the customer.
The actual delivery of products to the customer takes a longer time.
The persons involved in transactions require to learn computers.
Returning products, if not found to conform to the transaction, can be stressful and may also take a long time.
Risk in online transaction- Various parties related to transaction can face financial loss, credit lost and psychological loss.

M-Commerce

The process of selling or buying products or services using a wireless hand-held device like a cellular phone, personal digital assitant (PDA), etc. is called mobile commerce.
It is based on Wireless Application Protocol (WAP) technology.
All the financial transactions are done through mobile phone in mobile commerce application.
In March 1999, a partnership of four companies devised a novel method of ordering and payments of the Coca Cola company through short message service on C4BIT 99.
The first e-commerce service started by France Telecom for cell phones is considered to be the first mobile commerce service.

Internet

The internet is also called the net. The net is a system of networks spread out in the entire world, through which information collected by other computers can be accessed through one computer; www is a portal by which information about any topic can be obtained.
Messages can be exchanged using e-mail.
Files, pictures, animation, etc. can be transfered to another location.
Database related to government, individuals and private organisations can be searched.
History was created when a defence project was launched in 1969 implemented by the Advanced Research Projects Agency (ARPA) of the US government and it was named ARPANET.

Online Marketing/Internet Marketing

Online marketing may have to go through three stages on the basis of its trend.
Firstly, it includes propaganda and publicity.
Secondly, the delivery can be given online in case of information-intensive products and services.
Thirdly, information exchange is also done through traditional business system.

Method of Online Transaction

The buyer has to register himself online with the seller, in which the indicating word (password) of the buyer’s account has to be given. This password is to known only to the buyer and the seller, and no one else.
You can select the product of your choice from the shopping cart, which is an online record of the available products. After selecting the product, you can exit and select your own option for payment.
The buyer can select one of the following options of payment according to his/her convenience

(1) Cash payment on delivery
186 Js Recent Trends of Business (E-Commerce, Mobile Commerce, Networking Marketing, B.P.O., Franchise)
(2) Cheque payment on delivery
(3) Net banking transfer
(4) Credit or Debit Card
(5) Digital Cash

BPO or Business Processing Outsource

BPO implies giving the responsibility of executing some task to another party. This process reduces investment, and the firm is able to focus more on increasing its production.
BPO is oriented towards providing superior customer satisfaction, which makes it possible to handle customer liability, productivity increase and competition effectively, and as a result of this, profitability increases.
Various tasks are done by outsourcing such as call centre, medical transcription, billing, salary slip processing, data entry, information technology services, human’ resource activities, etc.
BPO is also called Information Technology enabled service.
BPO But : It is capable of freeing the employees of an organisation from some of their routine management responsibilities.
Four main elements are included in outsourcing- contract creation, contract research, contract marketing and information science.

Advantages of BPO

Freedom from looking after routine back-office operations, it also enables the managers to focus more on the primary business of the company.
This is achieved through process improvement, re-engineering and use of technology which reduces administrative and other costs that are kept under control.
Upon outsourcing the less important processes, companies can pay attention towards sales growth, market share growth, development of new products/ services, orientation towards new markets, customer service and satisfaction.
BPO uses the necessary guidance and skills of another company after ascertaining the specialised work sphere, instead of recruiting and training employees.
It is capable of handling the continuously changing demand of customers.

Disadvantages of BPO

The outsourcing of information system is unable to maintain proper confidentiality and secrecy.
There are many problems in BPO, like difficulties related to contract, unclear agreement, technical problems, lack of knowledge of I.T. process, etc. which are hard to identify.

Franchisee

The system of using a successful business model of another firm is called franchising. 0 The word ‘franchisee’ has its origin in the Anglo-French word ‘Frankese’. which means ‘free’. It is used both as a noun and a verb.
Franchisee provides an option to the franchisee to develop a ‘chain store’ for the distribution of products and to protect himself from the investment and liability of creating such a chain.
It is believed that as compared to a direct employee, franchisee is more motivated because he has a direct share in the business.
The special benefit to a franchisee in franchising is that he can launch his business quickly on the available trademark and he also does not need to build up the resources and basic infrastructure.

Types of Franchisee

The Franchisee, whose sphere is limited to one city, town or block, is called a small¬sized franchisee.
Medium sized franchisees are those which are limited to one or more than one district.
Large franchisees are those whose scope extends to a regional or metropolitian level.

Origin of Franchisee

Franchisee originated in the United States of America.
It is known that franchisee business had established itself in the 1930s in the US and still exists here.
In 2001, franchisee business ran in 7,63,183 firms which included a number of franchisee owners, and also franchisers.
Franchising is a business model which is used in more than 70 countries. They are- Subway (sandwich and salad), Mac donalds, Refresho, Cafe Coffee Day, Supercuts (Hair Salon), Incan donuts, etc.
There are defined laws on franchising in the USA and China has also enacted a law in 2007.
About 4% business in the USA is conducted through franchisees.
The franchising of products.and services is in its infancy in India. The first international exhibition was held in 2009. Big industrialists were attracted toward this in India.
In India, a contract exists between franchiser and franchisee in the form of franchisee
agreement, which is governed by Contracts Act 1872 and Special .Allowance (Relaxation) Act 1963, which provide solution in form of compensation in the event of breaking/infringement of the contract and special enforcement of the rules if contract.

Main Characteristics of Franchisee

They are for a definite period of time.
It is only a temporary business investment, business is not bought to be owned but. to lease or rent for a certain period of time.
Franchisee can be specific, non-specific or singular and specific, however provisions can be made in the franchisee revelation document for franchisee revenue ami profit.
National/International advertising, training, and tangible and intangible support services are usually provided by the franchiser.

Disadvantages of Franchisee

There is no guarantee or warranty in a franchisee agreement, and in the event of a dispute, the franchisee has very few or next to none legal provisions.
Franchisee agreements are one-sided agreements.
In low-cost franchisees, the training fee is considerably high.
There is no promise of success or profit from the franchiser.

Recent Trends of Business Class 11 RBSE Notes Important Terms

• E-Commerce — It is a general term in which all the commercial transactions implemented on electronic medium are included, with the help of which, customers and suppliers exchange products, services or information.

• B2B — The exchange of products, services and information between two businesses, enterprises, is called B2B
e-commerce.

• B2C — The exchange of products, services or information between an enterprise and customer is called business to customer e-commerce.

• C2B (Consumer to Business E-Commerce) – In consumer to business transactions, reverse customer to business auction is included, which empowers the consumer to execute transactions.

• E-Business (Electronic Business) – It is the conducting of business on internet, in which apart from sale-purchase, providing co-operation to the buyer and giving support to other supporting partners in the business is also included.

• M-Commerce — The process of selling or buying products or services using a wireless hand-held device, like- cellular phone, personal digital assistant, is called M-Commerce.

• Internet – The internet is also called the net. The net is a system of networks spread out in the entire world, through which information collected by other computers can be accessed through any one computer.

• Credit and Debit Card — They are also known as plastic money. This is the most widely used method in online transactions. In the credit card, the amount of debt on the card holder is taken upon itself by the issuing bank, while a debit card allows the user to buy up to that limit to which credit balance remains in his account.

• Digital Cash — It is a form of electronic money, which exists only in cyberspace. The bank conducting e-cash transactions will send you a specialised software which gives you the permission to make digital withdrawals from the account in your bank.

• BPO, (Business Process Outsourcing) – BPO implies giving the responsibility of executing some task to another party. This process reduces investments, and the firm/ company/industry is able to focus more on increasing its production.

• Franchisee – The system of using the successful business model of another firm is called franchising. Franchisee provides an option to the franchiser to develop a ‘chain store’ for the distribution of products and to protect himself from the investment and liability of creating such a chain.

EDI — Electronic Document Interchange
EFT — Electronic Fund Transfer
EBT — Electronic Bulletin Board
WWW – World Wide Web
WAP – Wireless Application Protocol
SMS — Short Message Service