Disadvantages of E-Commerce
- For the Consumer
• Unable to Examine Products Personally: If we buy products through the internet, we are not able to examine the products physically and the quality of the product. Images of the products may be available for viewing. But we can’t buy the product by seeing the image on the internet. There is a risk involved in the quality of the product that the consumer is purchasing.
• Online Purchasing Security: There are possibilities of credit card number theft.
- For the Business
• Hardware and Software: There are specific hardware and software that are essential to start up an e-commerce company that may be big and costly.
• Distribution: Distribution must be very efficient especially when catering to a global market.
• Maintenance of Website: The website must be maintained and updated regularly and this may lead to extra labor costs. The website should update the current information of the new product and the cost of the new product instantly.
• Costs: Even though the company may initially save money by cutting intermediaries, and not having to invest much on capital assets, other costs may be incurred by start-up costs of the company in terms of hardware and software as well as training of employees, costs to maintain the website, and distribution costs.
• Website Stickiness and Customer Loyalty: A company can have a website and exist within the Internet but there may not be enough people visiting the site and purchasing services or products from the company. The Internet provides less expensive advertising but also because of its sheer vastness and the existence of websites of established businesses, it is critical to create a website that is “sticky” enough to attract market share and create loyalty among the acquired market share.
• Training and Maintenance: The company needs well-skilled and trained workers to maintain and create the ecommerce facilities of the company. Many companies prefer to outsource their development and programming tasks to decrease labour costs.
• Security: An e-commerce business exposes itself to security risks and may be susceptible to destruction and disclosure of confidential data, data transfer and transaction risks (as in online payments) or virus attacks.