Mumbai University > Information Technology > Sem 7 > E–Commerce & E-Business

Marks: 5 M

Year: May 2015

The three main alternative locations for trading within the electronic marketplace include:

1. Seller controlled sites:

   These sites are the main home page of the company and are e-commerce-enabled. They are basically vendor sites, i.e. home site of organization selling products. This is the most common type for both consumers and businesses. In this model the sellers who provide to fragmented markets such as chemicals, electronics, and auto components come together to generate a common trading place for the buyers. While the sellers aggregate their market power, it simplifies the buyers search for alternative sources.

2. Buyer controlled sites:

   Buyer-controlled sites are intermediaries which have been set up so that it is the buyer who initiates the market-making. This can occur through procurement posting where a purchaser specifies what they wish to purchase, it is sent by e-mail to suppliers registered on the system and then offers are awaited. This model is used by large companies with significant buying power or a consortium of several large companies. Using this model the buyers are looking to efficiently manage the procurement process, lower administrative cost, and exercise uniform pricing.

3. Neutral sites:

   Neutral sites are independent evaluator intermediaries that enable price and product comparison. They are basically intermediaries not controlled by buyer’s industry. This model offers suppliers a direct channel of communication to buyers through online storefronts. The marketplace makes revenue from the fees generated by matching buyers and sellers. These marketplaces are usually active either in a vertical or horizontal market. Product-specific search engines, comparison sites and auction space are examples of neutral sites.