E commerce Assignment e-commerce e-commerce e-commerce

INTERNATIONAL COLLEGE OF BUSINESS & TECHNOLOGY LTD
ASSIGNMENT BRIEF
PROGRAMME

HND in Computing and Systems Development

UNIT NO

01

ASSIGNMENT
NO

UNIT TITLE

Business Skills for E-Commerce.

ASSIGNME
NT TITLE

Applying the skills of designing and evaluating ECommerce application to a selected organization.

INDIVIDUAL/
GROUP
STUDENT
NAME

Individual

ASSESSOR

Mr.Yasas Kaushan

DATE SET

05/02/2016

SUBMISSION
DATE

11/04/2016

Anuruddhika hettige

WORD
COUNT
STUDENT ID

HND/COM/M/17/03

INTERNAL
VERIFIER

SUBMITTED
DATE

RESUBMISSION
DATE
FINAL GRADE

RESUBMITTE

D DATE
RESUBMISSI
ON

ORIGIN
AL
UNIT OUTCOMES COVERED

LO1 Understand the structure and aims of the organization
LO2 Understand the impact of e-commerce
LO3 be able to design e-commerce solutions
AUTHENTICITY STATEMENT
I, Anuruddhika hettige hereby confirm that this assignment is my own work and not copied or
plagiarized. All the sources, from which information has been obtained for this assignment, have
been referenced. I further confirm that I have read and understood the rules and regulations out
plagiarism and copying and agree to be bound by them.
LEARNER SIGNATURE:

Grading
opportunities

L01.

DATE:11/04/2016

L01.

L02.

L02.

L03.

L03.

L03.

L03.4

L03.5

available/achieved

1

2

1

2

1

2

3

Original
Submission
Re submission

Assessor Name
Signature
Date
Grading
opportunities M1.1
available/achieved
Original Submission
Re submission

M2.3

M3.1

D1.1

D2.3

D3.1

Assignment Brief
The rapid advancement of technology and its application to business has been accompanied
by a range of new terminology and jargon. The use of the term “electronic commerce” has
been supplemented by additional terms such as e-business and e-marketing, and Even today,
with rapid growth of Internet revolution’, electronic commerce (e-commerce) remains a
relatively new, emerging and constantly changing area of business management and
information technology.
Electronic commerce operates in all four of the major market segments: business to business,
business to consumer, consumer to consumer and consumer to business. It can be thought of
as a more advanced form of mail-order purchasing through a catalogue. Almost any product
or service can be offered via e-commerce
Assume that you work for a firm of e-commerce consultants. You have been asked to produce
e-commerce solution guidance for an organisation.
To apply your solution, you are supposed to select any Organisation your choice and answer
the following tasks by producing a well-structured report.
Section A
Prepare a report with covering the following tasks.
1. Conduct a PEST analysis to the selected company and identify the macro
environmental factors. State the core business functions of the selected Organization
and Assess how macro environmental factors which (you have identified) can be used

to run core business functions of the organization successfully. (LO1.1)
2. Every organization has their own aims and objectives. Stakeholders can affect or be
affected by the organization's actions, objectives and policies. Evaluate the impact of
the aims and objectives of the selected organization by relating its stakeholders.
(LO1.2)
3. Investigate the possible opportunities of implementing an e-commerce system to the
chosen organization. You may consider about the market potential opportunities for an
e-commerce solution. (LO3.1)


Conclusion should reflect summarized idea about the potential opportunities
of implementing e-commerce to organizations. It should also describe the
usefulness of e-commerce to the selected organization ( D1.1)

4. Evaluate the current e-commerce systems in use by competitor’s organizations of
the selected company. How can e-commerce system promote knowledge sharing
between the company, its customers and suppliers? (LO3.2)


Effective judgments have been made about the usage of current trends in ecommerce in organizations. (M1.1)

5. Initial implementation of an effective e-commerce solution can be costs but it has
benefits in the long run of the company. Discuss the financial implications of setting
up and maintaining e-commerce solution to selected organization. (LO3.3)
6. Explain all the areas to be considered when designing an e-commerce solution to the
selected company. You can consider following aspects;
 Target markets,
 Business processes,
 Payment option,
 Security,
 Reliability
 The relevant legislations. (LO3.4)


Relevant designing considerations have been applied for the selected Ecommerce solution and they have been justified well.( M 2.3)

7. Evaluate the suitability of implementing e-commerce solutions to the selected
organization. Evaluate different e-commerce solutions and decide the most suitable
solution out of identified possibilities. (LO3.5)


Should be able to critically evaluate suitability of the selected e-commerce
solution to the organization. ( D3.1)

8. Risk is a potential of particular situation/action ends up with an undesirable outcome.
Introducing an E-Commerce application to an organization can involve a certain
amount of risk. Analyze the risk impacts of introducing an e-commerce application to
the organization you selected. (LO 2.1)
9. Use Harvard referencing for citation and compile reference list (M2.1)


Provide Standard and appropriate report format with correct use of
academically accepted formatting guidelines(M3.1)

10. Attach detailed Gantt chart to visible how all activities have been managed at the end
of the report. (D2.1)
Section B
Write an Essay approximately with 1000 words covering the following tasks.
E-commerce has impacted the society in both positive and negative ways. Discuss the
global impact of e-commerce on society. (LO2.2)

Report writing guidelines:

Report need to be produced with academically accepted formatting guidelines.
a. Paper: A4
b. Font size: Headings 14pt, Bold; Normal font 12pt
c. Font Face: Times New Roman or any other Serif Font face.
d. Page Layout
i. Margins Left 1.5”, right, bottom and top 1”
ii. Page numbering bottom, right
iii. Line spacing 1.5
Referencing Guidance
 To use Harvard referencing for citation and compile reference list you can go through
following guidance provided by Anglia Ruskin University.
 In the Harvard system, the author's surname and year of publication are cited in the
text of your work. The full details of the source are included in a reference list at the
end of the assignment.
(Anglia Ruskin University,2013)
You can follow below link for more details
Guide to the Harvard Style of Referencing 2013. University Library. [pdf] Anglia Ruskin
University.

Available


Octomber 2014].

at:
[Accessed

20

Assessor
OUTCOMES AND ASSESSMENT CRITERIA

EVIDENCE

Comments/page
no

LO1 Understand the structure and aims of the Written Report
business organizations

Identify

the

macro

environmental factors.
State the core business
functions

of

the

LO1.1)asses an Business organization core business selected Organization
functions

and Assess how macro
environmental factors
which can be used to
run

core

business

functions

of

the

organization
successfully
Written Report
LO1.2)Evaluate an organization’s business aims and Evaluate the impact of
show how they relate to stake holders

the

aims

objectives
selected
by

and
of

the

organization

linking

its

stakeholders.
LO2 Understand the impact of e-commerce

Written Report

LO2.1) analyze the impact including the risk of Analyze

the

introducing an e-commerce solution to the influences
business

introducing

risk
of

an

e-

commerce application
to the organization you
F

selected.
LO2.2) discuss the global impact of e-commerce on Essay
society.

Discuss global impact
of

e-commerce

on

society.

LO3 Be able to design e-commerce solutions

Written Report

LO3.1) Investigate the market potential for an e- Investigate
the
commerce opportunity.
possible opportunities
of implementing an ecommerce system to
the

chosen

organization relate to
the market it operates.
Written Report
LO3.2) evaluate the current e-commerce systems in
use by organizations
Evaluate the current ecommerce systems in
use by competitor’s
organizations of the
selected company
LO3.3) Discuss the financial implications of e- Written Report
commerce solution.
Discuss the financial
implications of setting
up and maintaining ecommerce solution to
selected organization
G

LO3.4) Design an E-commerce solution

Written Report
Explain all the areas to
be considered when
designing

an

e-

commerce solution to
the selected company.
LO3.5)evaluate the suitability of an e-commerce Written Report
solution
Assess the suitability
of

implementing

e-

commerce solutions to
the

selected

organization. Evaluate
different e-commerce
solutions and decide
the

most

solution

suitable
out

of

identified possibilities.
Assessor
Grade Descriptor for MERIT

Possible evidence

Comments/page
no

M1
M 1.1
M2
M 2.3
used.

Identify and apply strategies to find
appropriate solutions.
Effective
judgments
have been made about
Effective judgments have been made.
the usage of current
trends in e-commerce.
Select / design appropriate methods / Use
Harvard
techniques.
referencing for citation
and
compile
the
A range of sources of information has been reference list.

H

M3

Present and communicate appropriate
findings
To
disseminate
information, inclusion
M3.1 The appropriate structure and approach has of Graphs, Charts,
been used.
Figures, Tables etc.,
should be necessarily
included.
Assessor
Comment/Page
No

Grade descriptor for DISTINCTION

Possible evidence

D1

Conclusion
should
reflect
summarized
idea
about
the
applicability of ecommerce usage to
organizations.
It
should also describe
the usefulness of ecommerce
to
the
selected organization.

Use critical reflection to evaluate own
work and justify valid conclusions.
D1.1 Conclusions have been arrived at through
synthesis of ideas and have been justified.

D2

Take responsibility for managing and
Proper Gantt chart
organising activities.
should be included.
The assignment should
D2.3Activities have been managed
submit on time.
D3

Demonstrate convergent
creative thinking

/

lateral

D3.1Ideas has been generated and decisions taken.

/ Should be able
critically evaluate
suitability of the
commerce
to
organization.

to
the
ethe

Formative feedback from the Assessor
Module name / No: ………………………………………………..
Student name

: ………………………………………………..

Student number

:……………………………………………...…
I

Assessor Name

:………………………………………………..
Feedback

Date

Area Covered

Student

signature

Signature of the
Assessor

…………………………………………………………….

Date……………………………………

J

Acknowledgment
I would like to express my deepest appreciation to all those who provided me the ability to
complete this assignment successfully. Most of all, my deepest heartfelt gratitude goes to our
lecturer Mr.Yasas Kaushan, who covered Business Skills for E-Commerce module under the
HND program, also guided us to prepare this assignment in a proper structure.
Furthermore The Authors & Publishers of Books, Journal Articles & even Web pages are
much appreciated for keeping their precious piece of works available for our reference.
At last but not least, many thanks go to my parents who always encourage me in every
aspect, specially providing the monetary facilities that are much needed for my studies.

1

Executive summary
This is an assignment comes under Business Skills for E-Commerce module at HND in IT
program. For the completion of this assignment, students have to produce an E-Commerce
solution for a selected organization assuming that they work for a firm of E-Commerce
consultants.
For the completion of assignment, chosen organization by the student is Cargills food city
Matara branch. Cargills (Ceylon) PLC is a Sri Lankan Retail, FMCG, Banking and Restaurant
company which is listed on the Colombo Stock Exchange. The controlling interest in the
company is held by Ceylon Theatres PLC. Kargills foodcity Matara brance has been situated in
Anagarika Dharmapala Road.
To complete this assignment, a PEST analysis has been conducted over the selected
organization (Kargills food city Matara branch) identifying its’ Macro Environment factors and
how the identified macro environment factors can be used to run core business functions of the
organization successfully. After that the student has been identified objectives of the selected
organization and how they affect to the stakeholders. Then student has investigated possible
opportunities of implementing an E-Commerce system to the chosen organization evaluating a
current E-Commerce solution used by a competitors’ organization. After proposing an ECommerce solution, the student has discussed financial implications of setting up and
maintaining E-Commerce solution to the selected organization explaining all considered areas
when designing the proposed solution. Then the student has evaluated the suitability of proposed
E-Commerce solution to the organization. At last student has conducted a risk analysis to identify
the possible risks have to be faced when introducing an E-Commerce solution to the selected
organization. At the end of the assignment a proper conclusion has been made addressing
potential opportunities of implementing an E-Commerce solution and the usefulness of it.

2

Table of contents

3

List of figures

4

List of tables

5

Introduction
Cargills (Ceylon) PLC is a Sri Lankan corporate established in 1844 and built on a strong
foundation of values and ethics. Guided by trusted leadership it spearheads the sustainable
development of the food industry in Sri Lanka.
Its continuous investment in retail has made the Cargills retail arm Cargills Food City the largest
retailer in the island in all categories. Pursuing innovation and food safety its manufacturing
brands Cargills Supremo and Cargills Finest (processed meats) Cargills Kist (processed fruits
and vegetables) and Cargills Magic (ice cream and dairy products) lead sectoral growth. Its KFC
franchise is the largest international restaurant chain in Sri Lanka. Through its marketing and
distribution arm spread across the island Cargills distributes its manufactured brands as well as
internationally renowned food and non-food brands.
The Cargills agribusiness model has gained global recognition for linking farmers and
entrepreneurs to the market through a sustainable and inclusive value creation process.

Figure 01: Cargills foodcity logo

Source: https://pbs.twimg.com/profile_images/1542084496/foodcity_400x400.png
1

E Commerce stands for electronic commerce and caters to trading in goods and services
through the electronic medium such as internet, mobile or any other computer network. It
involves the use of Information and Communication Technology (ICT) and Electronic Funds
Transfer (EFT) in making commerce between consumers and organizations, organization and
organization or consumer and consumer. With the growing use of internet worldwide, Electronic
Data Interchange (EDI) has also increased in humungous amounts and so has flourished ecommerce with the prolific virtual internet bazaar inside the digital world which is righty termed
as e-malls.

2

Task 01
Conduct a PEST analysis to the selected company and identify the macro environmental factors.
State the core business functions of the selected Organization and Assess how macro
environmental factors which (you have identified) can be used to run core business functions of
the organization successfully.

What is PEST analysis?
PEST is an acronym for Political, Economic, Social and Technological. This analysis is used to
assess these four external factors in relation to your business situation.
Basically, a PEST analysis helps you determine how these factors will affect the
performance and activities of your business in the long-term. It is often used in collaboration
with other analytical business tools like the SWOT analysis and Porter’s Five Forces to give a
clear understanding of a situation and related internal and external factors.

Figure 01: PEST analysis
Economical

Political

PEST

Technological

Social
Source: Authors’ originated

3

Political
Here government regulations and legal factors are assessed in terms of their ability to affect the
business environment and trade markets. The main issues addressed in this section include
political stability, tax guidelines, trade regulations, safety regulations, and employment laws.
 Government type and reputation
 Free of the press, rules of law and stages of bureaucracy and corruption
 Regulation and de-regulations
 Public and employment legislation
 Tax policies and trade
 Environmental and customer-protection legal system
 Alterations in the political environment

Economical
Through this factor, businesses examine the economic issues that are bound to have an impact on
the company. This would include factors like inflation, interest rates, economic growth, the
unemployment rate and policies, and the business cycle followed in the country.
 Stages of a business development cycle
 Present and projected economic grown and interest rates
 Unemployment and supplying of labour
 Labour costs
 Levels of disposable earn and earning distribution
 Impact of globalization
 Impact of technological and other changes on the current economy

4

Social
With the social factor, a business can analyze the socio-economic environment of its market via
elements like customer demographics, cultural limitations, lifestyle attitude, and education. With
these, a business can understand how consumer needs are shaped and what brings them to the
market for a purchase.
 Cultural features, health senses, population growing rate, age distribution,
 Organizational culture, postures to work, management types, staff attitudes
 Occupations, education, living standards earning capacity.
 Media views, policy changes drive to social factors, trends and publicity
 Demographics: age, civil status, gender, family size, race

Technological
How technology can either positively or negatively impact the introduction of a product or
service into a marketplace is assessed here. These factors include technological advancements,
lifecycle of technologies, the role of the Internet, and the spending on technology research by the
government. (pestleanalysis, 2014)
 Advancing of technology, discovering of technological developments, researches
funding, implementation
 Internet, global and local communications, information technology
 Licensing, patents, finding of technology solutions, inventions, researches, intellectual
property issues, implementation in manufacturing, potential innovation,

 Transportation, energy sources, associated dependent technologies, rates of obsolescence,
waste removal or recycling

5

What is Macro environment
“A macro environment is the condition that exist in the economy as a whole, rather than in a
particular sector or region. In general, the macro environment will include trends in gross
domestic product (GDP), inflation, employment, spending, and monetary and fiscal policy. The
macro environment is closely linked to the general business cycle, as opposed to the performance
of an individual business sector” (Investopedia, 2016)

What is a business function?
Business Function is a description of work that is performed to accomplish a business unit's
responsibility.

Core business functions
Core business is the primary area that a company focuses on in business operations. All
companies try to maintain a strong position in these areas of business so that they remain market
leaders. Most businesses may have multiple functions but concentrate on the focal point so that
they are able to keep the resources and employees focused.
Understanding the core functions can help the business run optimally by giving them a
competitive edge. Before you start focusing on them, you may have first to define them. Each
unit of the business has to be analyzed for its strengths and weakness. It is also important to find
a synergy between the business units so that they are able to complement each other.
Businesses need to examine the various products/services to determine the ones that
complement each other in capital needs, structure, customer base, revenue streams, and
manufacturing. The business activities are then paired down to the ones that are strategically
viable so that they become the core. (ukessays, 2015)

 Before identifying core business functions, let’s identify the selected business
organization what type of a business is,
6

The selected business organization (Cargills foodcity Matar branch) is kind of a supermarket.
Supermarkets are large and complex business systems which depend on efficient management of
information.

Core business functions of the selected organization
The supermarket business can be divided up into five main functions, each of which performs its
own group of tasks, as follows:

Stock Control: The Stock Control Department is responsible for the following tasks:
•

Take delivery of new stock

All stock items are delivered with a supplier invoice. Stock control staff record the delivery on
the relevant purchase orders, and send the supplier invoices to the Finance Department to arrange
payment.
•

Dispose of unsold stock

All stock items have a use-by date. Stock control staff must monitor all goods from their time of
delivery, and ensure that out-of-date stock is disposed of, and not left on the shelves. They try to
ensure that there is minimum wastage of stock, which means they must monitor sales carefully
and advise marketing and pricing on the need for discounting to encourage purchase of stock
which is approaching its use-by date.
•

Monitor stock levels

Stock levels are monitored daily from the Stock Level Changes Reports provided by the Sales
Department so that the Purchasing Department can be informed of the need to order new stock.
•

Provide management reports

A Weekly Stock Level Progress Report detailing the stock levels of all stock items is sent to
Management to enable them to make better marketing and discount decisions.
7

Finance: The Finance Department is responsible for the following tasks:
•

Make supplier payments

Invoices from suppliers for goods which have been delivered are received from the Stock
Control Department. Payments are sent to suppliers according to their payment guidelines.
•

Accept customer payments

Details of the daily cash sales provided by the Sales Department are recorded. The cash is sent
to the bank.
•

Manage customer accounts

Account sales details are used daily to update customer accounts. Invoices are sent to customers
at the end of each month and must be paid in 14 days. Problem customers are followed up and
are placed on the cancelled accounts list if necessary.
•

Prepare financial reports

A monthly Financial Report based on sales and invoices paid during the month is prepared for
Management.

Purchasing: The Purchasing Department is responsible for the following tasks:
•

Order new stock items

When the Stock Control Department sends details of the need to purchase additional stock, the
Purchasing Department sends a purchase order to one of the suppliers of the specified stock
items. Before a purchase order is placed, Item/Supplier details are checked to get the best
possible deal for the current purchasing requirements. Sometimes a quick delivery is more
important than the best price.
•

Up-date stock item/supplier details
8

Information kept on each stock item is updated whenever a supplier provides the supermarket
with new or changed information. Purchasing use this information to help them decide which
supplier can offer them the best deal on each stock item.
•

Monitor deliveries

The Stock Control Department update purchase orders with delivery information as deliveries
are made. At the end of each day the Purchasing Department check the relevant purchase orders
to see if expected deliveries have been made. Suppliers are contacted and asked about overdue
items.
•

Management reporting

The Department provides Finance with Daily Purchasing Summary Reports and Management
with Fortnightly Purchasing Summary Reports.

Sales: The Sales Department is responsible for the following tasks:
•

Record cash sales

When a customer purchases goods for cash, details of the sale are recorded using the cash
register, and the customer is provided with a receipt giving the details of the sale and the
payment.
•

Record account sales

When a customer with an account at the store purchases goods and charges it to their account,
details of the sale together with the customer account number are recorded using the cash
register. The customer account card and a list of cancelled accounts must be checked before the
sale can be made.
•

Record orders and make deliveries

9

The Sales Department provides a service where customers can order goods by filling out an
order form on the store web site. Sales staff monitor orders submitted this way, the order, which
is then collected by the customer and paid for either by cash or account.
•

Sales reporting

On a daily basis a Sales Summary Report is provided to Management, a Stock Level Changes
Report is provided to Stock Control, and a Cash and Accounts Sales summary report is provided
to the Finance Department together with customers’ cash payments.

Marketing/Pricing: The Marketing/Pricing (M/P) Department carries out these tasks:
•

Decide what stock to sell

On a regular basis, M/P make long-term decisions about which goods to stock in the
supermarket. These decisions involve deciding what products are available and what the market
is likely to want. They are based on the following information:
- Marketing information about new stock items from product suppliers;
- Sales information about patterns and seasonal variations in product demand;
- Stock control information about slow-moving stock
•

Setting prices

M/P sets the normal price of all products. The supermarket’s price is based on the original
purchase price from the supplier, the cost of transport and storage, the volume and rate of sales,
and the desired profit margin for that product. M/P monitors all these and adjusts product prices
accordingly
•

Discounting prices

On a daily/weekly basis, M/P make decisions about offering discounted prices on particular stock
items. Existing stock levels and rates of sales are key factors in these decisions. M/P must keep
Sales informed of which items need to be discounted.
10

•

Advertising campaigns

On a fortnightly basis, M/P advice the supermarket’s advertising agency of the desired focus for
the next set of radio, TV and newspaper advertisements. This focus may be on product groups
(eg dairy, meat, fresh fruit, etc.) or specific products (this week’s discounted specials). Decisions
about which products or product groups will be based on stock availability, current sales levels
and external factors which are likely to affect demand (e.g. ice cream in hot weather)

11

How macro environmental factors can be used to run core business functions of the selected
organization

12

Task 02
Every organization has their own aims and objectives. Stakeholders can affect or be affected by
the organization's actions, objectives and policies. Evaluate the impact of the aims and
objectives of the selected organization by relating its stakeholders.

The vision and the mission of Cargills FoodCity

Vision - To be a Global Corporate Role Model in Community - Friendly National Development.

Mission - Serve the Rural Community, our Customers and all other stakeholders through our
core business - food with love - and other related businesses, based on our three main principles
of;
 Reducing the cost of living
 Enhancing youth skills
 Bridging regional disparities
By enhancing local and global markets.

Values –
C - Customer focused - Focused on customer delight
A - Accountable - An accountable and responsible corporate citizen
R - Respect - Respecting our culture, our country and the law
G - Green - Bringing our business in line with 'Green' concepts of Reduce, Reuse and Recycle
I - Innovative - Consistently innovative to ensure our core principles resonate in our business

13

L - Love - Spreading and winning Love through food
L - Lead - Leading corporate thinking and strategy
S- Serve the nation - Ultimately serving Sri Lanka true to our promise of being the "Pride of the
Nation" (cargills, 2016)

Aims and objectives of Cargills FoodCity

Stakeholders
The concept of 'stakeholder' is a diverse of 'stockholder', which related to 'owners in' or 'investors
in' a business or firm. We can define 'stakeholders' as 'groups and individuals who are affected by
activities of an organization. Most important stakeholders can be found as those with more to
lose from the organization's activities, but that does not always reflect their relative powers.'
Their objectives and goals are very immensely, but they must be considered.
Previously it had been the common concept that businesses basically expect and in turn
effect the economic capital, which is turn up in the form of stockholders. The rise to reputation of
stakeholders allow firms to realize that there are infrastructure and people beyond the company
which are need to it and who must have their attentions protected. An organization's stakeholders
are the parties who are able to reasonably be understood to be affected by its verdicts. They can
be considered to represent the businesses' social capital as well as economy. Mainly they can be
categorized into two groups as Internal, External and Connected Stakeholders.

14

Figure 03: Stakeholders

Source: https://figures.boundless-cdn.com/13782/large/stakeholder-28en-29.png
Internal stakeholders
Internal stakeholders include general groups such as managers and employees (and/or volunteer
workers or other types of members, in not-for-profit organizations). For example, the
procurement function may have to market itself to senior management or management teams, or
may have to communicate changes in purchasing policy and procedures to all staff.

External stakeholders

15

Businesses are increasingly aware of the need to maintain a positive reputation in the
marketplace, and this may require a more inclusive approach to stakeholder management, which
recognizes the legitimate needs and concerns of wider, secondary or ‘indirect’ stakeholders.
External stakeholders are likely to have quite diverse objectives and degrees of influence.

16

Task 03
Investigate the possible opportunities of implementing an e-commerce system to the chosen
organization. You may consider about the market potential opportunities for an e-commerce
solution

What is E-Commerce?
In its simplest form ecommerce is the buying and selling of products and services by businesses
or consumers over the World Wide Web.
People use the term "ecommerce" or "online shopping" to describe the process of
searching for and selecting products in online catalogues and then "checking out" using a credit
card and encrypted payment processing. Internet sales are increasing rapidly as consumers take
advantage of,
 lower prices offered by vendors operating with less margin than a bricks and mortar store
 greater convenience of having a product delivered rather than the cost of time and
transport and parking of going to a store
 sourcing product more cheaply from overseas vendors
 great variety and inventory offered by online stores
 comparison engines that compare and recommend product
 auction sites, where they did for goods

E-Commerce advantages
 Reduced costs by reducing labor, reduced paper work, reduced errors in keying in data,
reduce post costs
 Reduced time. Shorter lead times for payment and return on investment in advertising,
faster delivery of product
 Flexibility with efficiency. The ability to handle complex situations, product ranges and
customer profiles without the situation becoming unmanageable.
17

 Improve relationships with trading partners. Improved communication between trading
partners leads to enhanced long-term relationships.
 Lock in Customers. The closer you are to your customer and the more you work with
them to change from normal business practices to best practice e-commerce the harder it
is for a competitor to upset your customer relationship.
 New Markets. The Internet has the potential to expand your business into wider
geographical locations

Market potential opportunities for producing an E-Commerce solution
For producing an E-Commerce solution, we should well analyze the selected market place. For
that below factors should be analyzed,
Type of market – we have to analyze what type of a market that we’re dealing with. How the
consumer behavior & how they’ll react to the E-Commerce solution that we’re going to produce.

Market size – market size is a very important factor when producing an E-Commerce solution.
The selected marketplace is Matara city & it’s a kind of large market place which is suitable for a
new E-Commerce solution.

Growth rate – The products of this type are required to be sold in a large quantities to be
profitable and Cargills Foodcity is engaged in selling goods to customers in a B2C relationship,
but the chance for sale will occur, only if the customers will visit the establishment. By
introducing an e-commerce, the chances are, that customers will purchase products online, which
will increase the overall sales.

Distribution channels – The quality of the product is highly dependent on the speed of the
delivery to a consumer, from the time of production. Due to this time factor, it is important to use
direct distribution and utilize company's own resources. This is achievable because the customers
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are located in a close proximity to a restaurant and only on a local scale. Because of the small
volume of sales, it is not required to hire another employee to carry out distribution, but it will be
necessary to obtain a car dedicated to this purpose. Advantage of direct distribution is better
understanding of customers through personal contact with them. Cargills foodcity will continue
to offer a service, with a discounted price without the delivery charge, for a products purchased
online.

Customer strength – The customers' composition is relevant from an age point of view, where
customers of the age 16 and older, are able to purchase the goods online. Matara town
accommodates a large number of the students, which prefer the home delivery and take away
food. Customers' distribution is spread across the city limit in the walking and driving distance
from the restaurant, which could motivate customers to purchase from known local
establishment.

Level of competition – level of competition depends on the competitors’ existence of the
selected marketplace. Keels super can be identified as the main competitor of Cargills foodcity.
And they’re already step ahead providing a website where customers can purchase online. So if
the Cargills foodcity also provide an E-Commerce solution, it will increase the competition.

Strength & weaknesses – It is important to understand threats and opportunities of an ecommerce and its impact on businesses. Ability of Cargills foodcity to attract online customers,
especially new ones, is dependent on an advertising of the services offered.

Cost structure – Starting costs of e-commerce are steep, but once the e-commerce is acquired,
the operational costs of e-commerce and related expenses are lower. Cargills foodcity is entering
a new market and not starting a new business, so the operational expenses are calculated from

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current ones with added e-commerce expenses such as web hosting, cost of advertising,
marketing and expenses related to the in house delivery operations.

Task 04
Evaluate the current e-commerce systems in use by competitor’s organizations of the selected
company. How can e-commerce system promote knowledge sharing between the company, its
customers and suppliers?

 Each and every organization has their own competitors. Just like that, Cargills foodcity
Matara branch also has its’ competitor in Matara called Keels super which is also a
supermarket.

What is Keels super?
Keells Super of the John Keells Group is the leading supermarket chain in the country which has
been in operation for the last 20 years and has been focusing on offering the best in range, quality
products and services to our valued customers reaching out to a cross section of Sri Lankan
consumers. Currently we have 45 supermarkets in Sri Lanka and rapid expansion plans are
underway to make our presence felt in more locations.
The wide range of products include groceries, essentials, meats, vegetables, fruits,
bakery, dairy, household, toiletries and home-ware such as linen, books, stationery, pharmacy
and beauty counters at selected outlets.

E-Commerce solution used in Keels Super
Keels super is providing an E-Commerce solution for their customers in order to save their time.
They’re having an E-Commerce website where customers can purchase goods for the same price
with the store & they provide free delivery too. By this E-Commerce solutions, Keels super stays
a step upwards from the Cargills foodcity.
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Figure 04: Keels super E-Commerce website (online marketplace)

Source: https://www.keellssuper.com/ProductListView/G/GL

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Figure 05: Keels super product menu (online)

Source: https://www.keellssuper.com/ProductListView/G/GL

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Task 05
Initial implementation of an effective e-commerce solution can be costs but it has benefits in the
long run of the company. Discuss the financial implications of setting up and maintaining ecommerce solution to selected organization.

E-Commerce Advantages
Advantages to Organizations


Using E-Commerce, organization can expand their market to national and international
markets with minimum capital investment. An organization can easily locate more
customers, best suppliers and suitable business partners across the globe.



E-Commerce helps organization to reduce the cost to create process, distribute, retrieve
and manage the paper based information by digitizing the information.



E-commerce improves the brand image of the company.



E-commerce helps organization to provide better customer services.



E-Commerce helps to simplify the business processes and make them faster and efficient.



E-Commerce reduces paper work a lot.



E-Commerce increased the productivity of the organization. It supports "pull" type
supply management. In "pull" type supply management, a business process starts when a
request comes from a customer and it uses just-in-time manufacturing way.

Advantages to Customers


24x7 support. Customer can do transactions for the product or enquiry about any
product/services provided by a company anytime, anywhere from any location. Here
24x7 refers to 24 hours of each seven days of a week.



E-Commerce application provides user more options and quicker delivery of products.



E-Commerce application provides user more options to compare and select the cheaper
and better option.
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

A customer can put review comments about a product and can see what others are buying
or see the review comments of other customers before making a final buy.



E-Commerce provides option of virtual auctions.



Readily available information. A customer can see the relevant detailed information
within seconds rather than waiting for days or weeks.



E-Commerce increases competition among the organizations and as result organizations
provides substantial discounts to customers.

Advantages to Society


Customers need not to travel to shop a product thus less traffic on road and low air
pollution.



E-Commerce helps reducing cost of products so less affluent people can also afford the
products.



E-Commerce has enabled access to services and products to rural areas as well which are
otherwise not available to them.



E-Commerce helps government to deliver public services like health care, education,
social services at reduced cost and in improved way. (tutorialspoint, 2016)

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Task 06
Explain all the areas to be considered when designing an e-commerce solution to the selected
company. You can consider following aspects;







Target markets,
Business processes,
Payment option,
Security,
Reliability
The relevant legislations.

25

Task 07
Evaluate the suitability of implementing e-commerce solutions to the selected organization.
Evaluate different e-commerce solutions and decide the most suitable solution out of identified
possibilities.

26

Task 08
Risk is a potential of particular situation/action ends up with an undesirable outcome.
Introducing an E-Commerce application to an organization can involve a certain amount of risk.
Analyze the risk impacts of introducing an e-commerce application to the organization you
selected.

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Gantt chart
Chart Title
1-Apr

3-Apr

5-Apr

7-Apr

9-Apr

11-Apr

13-Apr

Task 01
Task 02
Task 03
Task 04
Task 05
Task 06
Task 07
Task 08

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Reference list
Pestleanalysis. 2014. Understanding Pest Analysis with Definitions and Examples. [Online]
Available at: < http://pestleanalysis.com/pest-analysis/ > [Accessed 02 April 2016]
Investopedia.

2016.

Macro

Environment.

[Online]

Available

at:

<

http://www.investopedia.com/terms/m/macro-environment.asp > [Accessed 02 April 2016]
Ukessays. 2015. The Core Business Functions of Food Chain Commerce Essay. [Online]
Available at: < https://www.ukessays.com/essays/commerce/the-core-business-functions-offood-chain-commerce-essay.php > [Accessed 12 April 2016]
Cargills.

2016.

Sustainability

Strategy.

[Online]

Available

at:

<

http://www.cargillsceylon.com/Sustainability/SustainabilityStrategy.aspx > [Accessed 02 April
2016]
tutorialspoint.

2016.

E-Commerce

–

Advantages.

[Online]

Available

at:

<

http://www.tutorialspoint.com/e_commerce/e_commerce_advantages.htm > [Accessed 04 April
2016]

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