What is E-Business | Meaning, Types, Components, Model and Features

10 min read

Electronic Business (E-Business) is the administration of conducting any business using the internet, extranet, web, and intranet. This would include buying and selling of goods or services using commercial transactions conducted electronically along with providing customer or technical support with the help of the internet. E-business is similar to E-commerce but it is more than just a simple act of buying and selling services or goods online. In fact, it is the method of utilizing digital information and advanced communication technologies to streamline different business processes – from the initial to the implementation phase. E-business includes a lot of business processes including online order processing, CRM (Customer Relationship Management), supply chain management, and many more. E-commerce is a part of e-business, so let me give you a comprehensive detail about what is e-business. 

If you are ready to build your own eCommerce store for just buying and selling the products then follow 9 steps to start an eCommerece business.

Components of E-Business

What is e-business: Components of e-business

E-business has several components including BI (Business Intelligence), CRM (Customer Relationship Management), ERP (Enterprise Resource Planning), SCM (Supply Chain Management), Collaboration, online activities, and electronic transactions within the firm. But following three areas have great importance for e-business: 

1. E-Procurement

It is also known as supplier exchange in which business to business, business to government, business to consumer, and sales of services are made with the help of the internet. Basically, e-procurement is a way adopted by companies to reduce costs and efforts by sourcing products or services electronically. 

2. Online Stores

It is electronic sourcing (website or application) for products or services, such as online shopping stores. Online stores are also known as e-shops, internet shops, web-store, virtual stores, web-shop, m-commerce, and online storefront. The main purpose of these online stores is to save precious time and money.  

Anyone can buy products or services by making online payments using credit cards, cash on delivery, and other payment methods. The owners of online stores should host their eCommerce website on the PCI compliant hosting because Payment Card Industry Security Standards Council (PCI SSC) makes it compulsory for those who are accepting the online payments.

3. Online Marketplace

It is electronic commerce that connects the buyers and suppliers to the services or products over the internet. Keep in mind, that the operator of an online marketplace only presents the inventory of other people and provides the transaction facility. 

Moreover, the following are also known as e-business areas:  

4. Online Communities

Online communities (also known as web communities or internet communities) are groups of people having the same interests or purposes who use the internet to communicate with each other. It is used between individuals and organizations to prepare transaction decisions.

5. Online Companies

It is electronic business cooperation that connects the individual companies and forms a virtual business with a common transaction offer.  

Order Fulfillment Process

The order fulfillment process is based on all the activities needed for a customer to get his ordered product or service including the related customer services. What is e-business and how the orders are processed are discussed with the help of particular figures?

What is e-business: What is order fulfillment process

1. Product inquiry

You are surfing the website of any well-reputed business brand manufacturing laptops, desktops, or monitors, and able to view their all products.

2. Sales Quote

Laptop prices, screen size, or usage are clearly mentioned on the website for the sales quotation for customers. 

3. Order Configuration

Once the customers select what they proposed to purchase, the number of products is easily adjusted or canceled during this phase. 

4. Order Booking

This phase includes the booking of products available on the website, such as desktops, laptops, or necessary accessories.

5. Order Confirmation

This process ensures the details of the order such as prices and quantities are accurate. 

6. Billing

Billing is the process that enables customers to pay for the products by Visa, cheque, ATM, or other available payment methods.

7. Order Planning

Every customer has different options for delivery, so the order will be delivered accordingly. 

8. Order Processing 

Once the order is confirmed, the company ensures the right item in the right quantity, time, place, price, and condition to the right customer. 

9. Shipment 

According to the customers’ requirements, the products will be delivered by means of an express, Air-to-Sea initiative, and so on.

10. Delivery 

The products will be delivered within a given time slot at the right address.

11. Settlement 

It is the method to settle all the remaining charges, like delivery costs or extra products care expenditure.

12. Returns 

Most of the companies offer the returns option with their particular terms and conditions. So, any customer who has received the products with any technical or physical problems of products, can easily return their products within a specified period. 

E-Business Model

What is electronic business model and its components? In fact, it is a way that describes how a company functions to provide the services or products and how it generates profits. Moreover, it also defines how a company will create and adapt to new technologies or markets. All components of a business model work together for successful business operations. 

What is e-business: E-business model

1. E-business Concept

What is e-business concept and how is it essential for a successful business? It describes the basic information of the business including goals, vision, products, and offers from which it will earn revenue. The effective concept is based on market analysis that will identify the customers’ interests to purchase the product and how much they can pay for it.  

What is e-business concept? It is based on goals such as “Become a major bus seller or commercial enterprise” and objectives such as “have $80 million in revenues in five years”. Whether the company is prepared to achieve its goals and objectives addressed in the implementation plan for running a business and in the business plan process for startup companies. 

Corporate strategies are also embedded in the e-business concept and describe how the business concept will be implemented and can be modified in order to enhance business performance.

Business concept and market research are important to understand the market, who comprises it, and what they want. Once the market research is done, now the pricing should be established according to the competition. 

2. Value Proposition

As the name denotes, the value proposition is a value that an organization or business will provide to its customers. It may include one or more of the following points: 

  • Reduced price
  • Improved service or better functionalities with user-friendliness
  • Speedy delivery and improved assistance
  • Products or services that result in greater efficiency and productivity
  • Access to available inventory has different options for the buyer

Value Delivery With The Help Of Integrations 

Every functional website is based on two parts: frontend for dealing directly with the customers and the backend in order to automate the online operations of the company without having direct dealing with customers. Order placements using POS (Point of Sales) systems, product customization, tracking, and order fulfillment are the activities that require integrated systems. 

3. Sources of Revenue

What does eCommerce mean and how do companies earn revenue? Ecommerce is also known as Electronic/internet commerce, refers to the buying and selling of services/products. It also includes the online payment options for a great online shopping experience. So, e-business will have three, four, or a mix of the following sources referred to as a revenue model:

  • Advertisement
  • Affiliation
  • Agent/Representative commissions
  • Licensing
  • Sales commissions
  • Sponsorship
  • Syndication
  • Use Fees
  • Subscription

4. Required Activities, Resources, and Capabilities

In order to carry out the mission of the business, different activities are required and certain resources are needed. For example, professional employees with specific skills or capabilities can better perform particular business activities. 


Particular business processes or groups of processes that are required to implement the business concept are known as activities. The operational business model is used to identify the costs/expenses and outputs of each activity. 

What is e-business and its processes? Keep in mind, that some of the e-business activities may infringe on patents. Different business processes or “Methods of doing business” might be patented, so that the business model may unintentionally include the intellectual property and patents will be freely awarded for business processes. For example: 

Amazon’s “one-click” purchasing patent has the most widely renowned patent infringement case because buyers can easily buy the products and services without using a shopping cart. Several companies have patented Internet Business Models, which are being used by many companies. So, they charge for licensing otherwise they will face problems in the future development of e-business. 


Organizations require human, tangible, intangible, and supporting resources in order to perform their activities in an efficient manner. Tangible resources are also known as physical and financial including company equipment, case reserves, and facilities. 

Whereas the intangible resources include the customized software, customer data, intellectual property, and business processes that can be patented. Supporting resources include the IT and communication processes and organizational structure.  


Workers with the required skills are vital for every successful business. What is e-business and Why are the capabilities necessary?  E-business is similar to the traditional business except for internet presence, broader audience, and buying facility without visiting the company’s outlet. First/initial wages are the highest cost for a business and capable workers may not be available all the time.   

Critical Factors of E-Business Development

Critical factors for e-business

Generally, e-business application development is based on four critical factors: where the assets reside (databases), how they are processed (applications), who manages the processes or applications (IT/Operating Staff) and who is the beneficiary (end-user)?  

Important E-Business Drivers

Why e-business?

What is e-business and why do we need its drivers? As you hire a salesman for your traditional shop to efficiently manage your processes and to increase your sales. For a similar purpose, there are several processes used to enhance e-business operations and functionality with the help of different drivers. These drivers include streamlining physical operating processes, reducing their costs, delivering rapid response (information), and increasing services to customers as you can see in the figure given below: 

Product Inquiry Fulfillment Process

Once you have finalized the product availability inquiry in order to make your e-business application more effective and trustworthy. It is necessary to identify the information assets and mapping them with the processes that support them. In the example given in the picture below is the information asset created by the process “product availability”. 

The E-Business Supply Chain 

In order to understand the e-business conceptually you need to be defined from both B2C and B2B perspectives. In B2C, online retailers have introduced a consumer-based supply chain to assistances of Internet consumers and enhance the processes of the physical world as you can view in the figure given below: 

There are mainly three classes of B2C that make it possible the e-business realities: 

  • Delivery of unlimited products under the single business brand
  • Creation of new market channels 
  • Eliminating the middlemen 

Amazon is the first, eBay is the second, and Dell is an example of a third B2C e-business class.  

What is E-Commerce and its Types?

It is the short form of “Electronic Commerce” that is used for buying and selling products or services over the internet. E-commerce has the following types: 

1. Business to Business (B2B)

Business to business

As the name represents, it is the name of electronic transactions of different services or products between two companies or businesses. Payment processing companies and customer relationship management (CRM) platforms are included in the B2B model. 

2. Business to Consumer (B2C)

Business to consumer

B2C is the most common form of e-commerce business because it is the relationship between a seller and final customers. Business to Consumer has developed greatly with the development of the internet and the latest technologies. Anyone can find various kinds of online stores on the internet and buy products or services without visiting the market. Composable commerce and MACH (Microservices, API-first, Cloud, Headless) represent a customer experience revolution in e-business. According to Grid Dynamics shifting from monolithic systems to flexible, modular architectures allows retailers to assemble best-in-class commerce components for each step of the customer buying journey—from product discovery to delivery, and beyond.

3. Consumer to Consumer (C2C)

consumer to consumer

In C2C, electronic transactions are made between the customer and another customer. It became possible with the help of third-parties such as eBay as a marketplace for online action. 

4. Consumer to Business (C2B)

Consumer to business

Any particular company cannot provide anything and they also need different products/services to execute their business processes. So, it is a kind of business model in which the customers or users create a service/product that is used by the company. For example, any freelance designer is creating a logo and any business can use his services as they need.  

5. Business to Administration (B2A)

Business to administration

B2A is a form of electronic transactions of the products or services in which the business and government are involved. For example, social security, legal documents, etc. 

6. Consumer to Administration (C2A)

Consumer to administration

Consumer to Administration includes all transactions between the consumer/customer and the government. For example, taxes, education, etc. 

Recommended Blog: E-Business Security l Importance, Threats & Solutions

What are The Key Differences Between E-Commerce and E-Business?

  • E-Business is not limited to just buying and selling products or services. Whereas E-Commerce is the name of buying and selling products/services with the help of the internet. 
  • E-Commerce is a main part of E-Business
  • There is no need for an E-Business to have a physical presence. If the company has physical offices along with its online business activities then it can be referred to as E-Commerce.
  • E-Commerce supports any kind of business transaction related to money, but E-Business includes monetary and allied activities.
  • E-Commerce needs the internet to be able to communicate with online customers from all over the world. E-Business can use the internet, intranet, and extranet to be able to connect with the parties.

If you want to build your own e-business or e-commerce store then register a domain name, get Cloud VPS Hosting and start developing your store from scratch like a professional.

11 thoughts on

What is E-Business | Meaning, Types, Components, Model and Features

  • Chesco Haule

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  • Maduranga Pathiraja

    Hi, I am a beginner, kindly assist me to start e business, what is the first step I should do

    • David Max

      Sure, You need to register a domain name first then get a web hosting plan. Linux Shared hosting plan will work for you. Temok is offering Free .com domain with their Linux Shared Hosting Plan. You can get both of them at a lowest price.

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  • lisa

    How these e-business transition is more successful compared to e-commerce? Discuss the significances.

  • Lyka Patricia Llamas

    Hi! What is E-business Security?

  • Huma

    Hey David!
    Thanks for writing such an informative article, you have explained E-business very well.

    • David Max

      You’re welcome Huma. Thanks for your kind words.

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  • mahnoor khan

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