E-commerce

Due to the increasing business competition, Grandma Treats has embarked on an initiative that will enable it to sell its goods and services anytime, anywhere over the internet rather than relying on the traditional face to face selling.

However, there are different business models of online selling, which may include storefront, auction, portal or a combination of both.

According to Susan Royer (2005, p.16), storefront model can give organization such as Comp USA, an immediate advantage of the global basis on their first day of operations, they do not necessarily have to distribute their goods physically which engages them on an international e-business activities from the start.

With storefront, organizations that sell online such as Comp USA, are likely to generate more revenue with a unique customer shopping experience, this is because customers are able to navigate through their website while viewing products  services and comparing prices in a single, centralized platform, at their own conveniences (EFI). Other notable advantages may include order status, history, re-ordering mechanisms, shopping carts, multi lingual capabilities among others.

There is also the auction model such as the Ubid auction where the goods and services do not have a specific price, people place their bids for goods and the bids may be higher or lower than the market value.

However some of the drawbacks associated with this concept are that buyers whom are the bidders may be impatient in the sense that they want the goods immediately (Terrence Hendershot, 2006, p.324).

Other disadvantages may be related to the declining price anomaly whereby the organization may lose revenue just for the sake of maintaining its status as a legitimate organization.

For grandmas treat, CompUSA website concept would be the most ideal, this is mainly because there is no declining price anomaly, prices are fixed and it becomes easier for the organization to anticipate on its revenues.

According to Michael Schwind (2006, p.28)Dynamic pricing is applicable to the concepts employed by organizations such as CompUSA because it allows the adaptation of resources in the resource system according to demand function and current system load which makes it easier to price goods according to seasons such as Christmas, Easter and back to school offers.

In addition to this, the storefront model is easier to set up because there are hosted solutions available which can be bought as a package, you just load your products and things are up and running, the organization may sit and let their service provider do everything for them or go for a hosted solution in order to incorporate their website into their existing I.T infrastructure. There is no declining price anomaly hence easier to anticipate and plan for the future.