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Disadvantages Of E-commerce
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Published: October 3, 2006
There are disadvantages to e-commerce businesses just as there are advantages. Like brick and mortar companies, e-businesses are never guaranteed an easy life. Hard work, education and wise choices among other things are the keys to a profitable online store.
One of the most familiar disadvantages of online shopping has to do with credit cards.
There is a risk of someone gaining access to your credit card number during the payment process or through hacking into your computer files. This is why some people simply refuse to buy anything online. Another issue is compulsive shopping online. Because of the convenience of online shopping, credit card abusers become addicted to buying online, just as an addict overbuys at a mall.
There is also what is called the "personal touch factor." Buying anything online prevents the customer from actually touching the merchandise while they're browsing. Trying on a pair of shoes, flipping through a book or any other physical activity is impossible in cyberspace.
There are disadvantages for the merchant as well as the consumer. A merchant must have the correct hardware and software for the business: security software including anti-virus, firewalls and encryption for online payments. This hardware is big, bulky and expensive. An efficient distribution system, as well as website training and maintenance, must be performed along with controlling finances.
Some customers become annoyed with slow-loading pages due to animation and graphics, banner ads, and e-mail membership lists. An annoyed customer may become a lost customer.
Next there are tax issues. In the beginning of e-commerce, legislators wondered how much of a tax to charge online consumers compared to physical stores. The correct sales tax must be calculated for each customer in relation to which state that customer lives in. Also, fair shipping costs and available couriers must be posted and charged accordingly for goods to be shipped to the customer.
One e-commerce disadvantage that is out of the control of both consumer and merchant is network unreliability. It is estimated that 100 million people in North America alone use the Internet, creating a lot of traffic. When a network connection fails, e-businesses cannot sell their products. This equates to lost sales, lost revenue and lost credibility–which creates lost customers. Though there have been several incidents of lost network connections in recent years, it is not a day-to-day concern for merchants.
Musco, Taj Jenkins. "E-Commerce Disadvantages." Hampshire College, Amherst, Massachusetts. Copyright 2006. October 3, 2006. http://hamp.hampshire.edu/~tjm99/disadvantages.htm l
Tanjuakio, Joyce. "Disadvantages of E-Commerce." University of Toronto, Toronto, Canada. Copyright 2005. October 3, 2006. http://home.utm.utoronto.ca/~jmt/260Web_TanjuakioJ oyce/CCT260WebSite/page4.html
Peacock, Jennifer. "Disadvantages of E-Commerce." Illinois Institute of Technology (IIT). October 9, 2002. Copyright 2001. October 3, 2006. http://www.iit.edu/~peacjen/cs485/ecommerce3.htm
No author given. "E-Commerce Disadvantages." www.course.com. October 3, 2006. http://www.course.com/downloads/additional/14.3.2_ e-commerce_disadvantages.pdf
One of the most familiar disadvantages of online shopping has to do with credit cards.
Related Articles
There is also what is called the "personal touch factor." Buying anything online prevents the customer from actually touching the merchandise while they're browsing. Trying on a pair of shoes, flipping through a book or any other physical activity is impossible in cyberspace.
There are disadvantages for the merchant as well as the consumer. A merchant must have the correct hardware and software for the business: security software including anti-virus, firewalls and encryption for online payments. This hardware is big, bulky and expensive. An efficient distribution system, as well as website training and maintenance, must be performed along with controlling finances.
Some customers become annoyed with slow-loading pages due to animation and graphics, banner ads, and e-mail membership lists. An annoyed customer may become a lost customer.
Next there are tax issues. In the beginning of e-commerce, legislators wondered how much of a tax to charge online consumers compared to physical stores. The correct sales tax must be calculated for each customer in relation to which state that customer lives in. Also, fair shipping costs and available couriers must be posted and charged accordingly for goods to be shipped to the customer.
One e-commerce disadvantage that is out of the control of both consumer and merchant is network unreliability. It is estimated that 100 million people in North America alone use the Internet, creating a lot of traffic. When a network connection fails, e-businesses cannot sell their products. This equates to lost sales, lost revenue and lost credibility–which creates lost customers. Though there have been several incidents of lost network connections in recent years, it is not a day-to-day concern for merchants.
Musco, Taj Jenkins. "E-Commerce Disadvantages." Hampshire College, Amherst, Massachusetts. Copyright 2006. October 3, 2006. http://hamp.hampshire.edu/~tjm99/disadvantages.htm l
Tanjuakio, Joyce. "Disadvantages of E-Commerce." University of Toronto, Toronto, Canada. Copyright 2005. October 3, 2006. http://home.utm.utoronto.ca/~jmt/260Web_TanjuakioJ oyce/CCT260WebSite/page4.html
Peacock, Jennifer. "Disadvantages of E-Commerce." Illinois Institute of Technology (IIT). October 9, 2002. Copyright 2001. October 3, 2006. http://www.iit.edu/~peacjen/cs485/ecommerce3.htm
No author given. "E-Commerce Disadvantages." www.course.com. October 3, 2006. http://www.course.com/downloads/additional/14.3.2_ e-commerce_disadvantages.pdf
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