E-business in a B2B wholesaler's internal supply chain: effects on costs and activities
by Marko Seppanen, Petri Suomala
International Journal of Electronic Business (IJEB), Vol. 1, No. 4, 2003

Abstract: The primary aim of the paper is to indicate the effects of e-business on the costs of supply chain activities. The empirical data have been collected through a case study in a B2B wholesaler company. In order to analyse the cost effects of e-business solutions in a logistic chain, it is imperative to conduct a cost analysis across several activities. The calculation of both the total activity costs and the unit costs of activities was carried out by activity-based costing. As is quite often supposed, the results obtained indicate that the unit cost of a web-based order entry was lower than the unit costs of other sales channels. The ratio was approximately 1:6, respectively. However, order processing entails only a small part of the order's total costs. An assessment of the total cost effects of e-business requires that the cost structure of the environment be well understood.

Online publication date: Mon, 10-May-2004

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