Top 4 eCommerce Business Models

in Technology on September 9, 2022
eCommerce Business Models

Technology is transforming the way we used to buy and sell things. People prefer online platforms over physical outlets to sell their products. This reduces the cost of opening up a start-up to a minimum. With every passing day, the world of eCommerce is seeing exponential growth. Here are some best examples of eCommerce Business Models.

eCommerce is the buying and selling of goods through electronic/online platforms. Its sales are growing at a whopping rate of 10% all over the world. The first step in setting up an eCommerce business is to figure out the business model that suits your needs and targeted audience the best. The selection of the right business model is key to earning revenues in the future, much like the selection of the right bet at betFIRST is key to cracking the world of online sports bets.

Listed below are the top 4 choices of people when considering eCommerce business models.

1.  B2B eCommerce Model

Easily the most popular model, most start-ups opt for B2B eCommerce as the most suitable model for their needs. As its name indicates, this model is used for buying and selling of things between two established businesses.

The B2B eCommerce model attracts more buyers as the trading is usually in bulk, reducing the revenue margin over a single product. Therefore, the trading is cheaper to the buyer, who aims to sell it to another business at a slightly higher price or to customers directly to earn significant revenues.

B2B eCommerce can be challenging for beginners who lack experience because it is difficult to strike a deal with a business rather than a customer. Moreover, bulk trading also makes the process of inventory cumbersome.

2.  B2C eCommerce Model

This is the most traditional eCommerce model. The coming decade is perceived to be boosting the B2C eCommerce model. The global revenue is expected to grow by up to 85% by the next year.

The advent of technology is another major reason for the growth of this model. Today, more and more people prefer to buy things online rather than going through the hefty process of buying it from a physical outlet. Unlike physical stores, this model can work 24 hours a day and 365 days a year without taking any days off.

The cost to set up this model is also low. One can even simply start with drop shipping, providing the service of direct delivery from a manufacturer to the customer. The investment is close to the minimum in this model so those who are ready to explore the eCommerce world but don’t have the heftiest of financial means must go with this one.

3.  C2C eCommerce Model

This business model is relatively new in the marketplace. Craigslist and eBay are among the first few businesses that opted for this model successfully. Under this model, the consumers exchange products and services. When referring to trading goods online, the C2C eCommerce model comes in handy.

Historically, flea markets would be set up to allow the exchange of goods between consumers. However, the emergence of online platforms has provided a more convenient space to trade things among consumers. From buying and selling houses to cars, everything can be traded online with a wide range of audiences.

Although the competition can be higher on online platforms, the absence of any intermediaries significantly improves the profit margin. The audience is also global in the case of C2C eCommerce, as opposed to a flea market where only local audiences are available.

4.  C2B eCommerce Model

This model is still unknown to many people. It allows the customers to sell their products to businesses directly, which was unheard of in the past. The customers have a dominating hand on the negotiation table.

The C2B eCommerce model is similar to a sole proprietor serving the needs of a large business. The profit margin is substantial, depending on the buying power of the companies involved in the deal.

It can become difficult at times to serve the needs of a large business. There can be delays in transportation and responsiveness due to the disproportionate amount of people on the selling and buying side, but the use of proper skill can turn this model into the highest profitable one.