Electronic Commerce

Summary

Electronic commerce can be defined in different ways. Each definition helps

to understand and explain the concept better. Electronic commerce is a set
of procedures and technologies that automate the task of financial
transactions using electronic means.
Also, according to some authors, electronic commerce is defined as a new
concept, which is being developed and includes the process of buying and
selling or exchanging products, services or information through computer
networks, including the Internet. Electronic commerce is not limited to
merchandising, but also includes all pre-sales and after-sales sales
activities during the supply chain.
Introducing electronic commerce, using Internet and Web services in
business, is aware of the path to a truly new economic Internet economy.
Keywords: electronic commerce, development, purchasing, sales, economy,
internet.

INTRODUCTION
Today, the development of modern means of communication, especially
electronics, which radically alters the relationships of forces and
strengths that exist in the global marketplace, has an important role in a
clearer process of globalization. The magnitude of the impact of developing
a source of communication and information on the world economy may be
implied by the fact that it is entering traditional labor-intensive
activities, where previously there was no possibility of modern information
technology.
Managers of large corporations, as well as small and medium-sized
companies, need to understand first of all the interests, as well as the
many advantages that modern digital technology uses to enable them to
create new business ideas and realizations. In the new digital era, e-
business benefits and opportunities are significant potentials that must be
used in the best and efficient way. Thanks to the internet there are some
changes in the way business, geographical boundaries disappear, language
barriers and currency restrictions are enforced.

ELECTRONIC TRADING

The way of doing business today is really changing, thanks in large part to the Internet. E-commerce
has a major role in the process of globalization and in the development of modern means of
communication, especially electronics, by radically changing forces and forces in the global
marketplace. In modern business there is a transition from business to electronic phase. In addition,
technological aspects need to emphasize economic aspects and define e-commerce as a new market
that offers new types of goods and services, such as digital products through digital processes.
Physical goods sellers are also included in the digital process, such as on-line booking, market
research and payments, which are part of the new market. (Uros T. 2006).

Electronic commerce is the exchange of business information, maintaining business relationships,

and conducting business transactions between various organizations through telecommunications
networks and more than a set of Internet technologies (Milosavljević, Grubor, Veinović, 2009).

E-commerce can be seen from a narrower and wider perspective. In a narrow sense, electronic
commerce involves purchasing and selling through the Internet, and in a broader sense, it includes
the exchange of business information, maintaining business relationships, and conducting business
transactions through telecommunications networks. (Skripta za prijemni, 2009). In fulfilling his
duties, he uses electronic communication media such as the Internet, extranet, e-mail, database and
mobile telephony. Electronic commerce includes several activities such as electronic sales and
purchases of goods and services, online digital content delivery, electronic funds transfer, public
procurement, direct consumer marketing and other after-sales services. The basis of e-business is
often called digital business entirely and contains three components: products, processes and
participants, which have two components, physical and digital. Everything that can be sent and
received via the internet is considered a digital product.

Electronic commerce creates new markets and economic activities, characterized by information
processes and rapid market dynamics. The electronic network provides the infrastructure for
collecting and disseminating information. They also serve as a new channel for sales, product
promotion and delivery services. In addition, the network integrates information to manage business
activities at all levels of the company and provides new electronic connections with customers and
partners in the supply chain. The increasing number of activities that add value to the economy
takes place in the virtual world through globally connected electronic networks. The Internet has
expanded the company's reach. Managers can detect more business opportunities because they get
a lot of additional business information from the Internet.

ELECTRONIC MARKET

Milicevic (2002) argues that the Internet and new information technologies lead to market
restructuring at a global level and some industrial and service sectors. As well as traditional
(physical) markets, also in the electronics market, customers and sellers exchange goods and
services with money or other goods or services, but only electronically. The electronic market uses
electronic transactions that lead to new ways to distribute products and services to end consumers.

The electronic market means the place of electronic commerce carried out, namely the interaction
and communication networks where information, products, services and payments are exchanged.
In recent years, the electronic market is increasingly important in the modern way of doing business.
When it comes to electronic business, the business center is a network based on the location where
there are customers, sellers and other participants and they all find each other electronically and in
business.

ELECTRONIC TRADE MODEL

There are many electronic trading models that vary according to the relationships that exist between
participants in trade (companies, customers, employees, government). Some of the models are: B2B,
B2C, B2E, C2C, C2B, but lately there is also a more complex form that was created as a combination
and renewal of existing models like B2B2C and C2B2C.

• B2B (Business to Business) is the automated exchange of information between various

organizations;

• B2C (Business to Consumer) means the sale of goods and services to the end consumer;
• B2E (Business to Employee) is a model also known as Intranet, or a Web site that provides
products or information to employees;

• C2B (Consumer to Business) is an amodel whereby a consumer requests a product or service from
a seller;

• C2C (Consumer to Consumer) is a model where customers sell each other;

• B2B2C (Business to Business to Consumer) is a model realized using a B2B model that supports the
company's operations on the B2C model;

• C2B2C (Consumer to Business to Consumer) is a model that connects consumers by using an on-
line company as an intermediary.

SPECIAL LEGAL ISSUES FOR ELECTRONIC TRADE

The most important legal issues specific to e-commerce are: assigning domain names, collecting
taxes from electronically generated revenue and intellectual property protection. When assigning an
Internet address or domain name, a problem arises when several companies that have similar names
compete around the domain. The problem is solved in court or before the international arbitration
system. The federal, state and local governments are trying in every way to calculate how to get a
share of electronically generated revenue. The problem is particularly prominent in international
trade, when the question is where you need to pay taxes for business licenses, income taxes, value
added taxes, annual income taxes and the like, and who controls those allegations. The protection of
software and other intangible creations is difficult to implement via the Web, which is why the issue
of copyright and intellectual property protection is a frequent topic of discussion.

One solution is a unique tax to the Internet, called "bit taxes". The idea of this tax is based on the
fact that every bit that runs through the network is the subject of taxation at a unique rate. These
can be collected on the telephone exchange or at the service provider and submitted to a competent
tax officer. However, such taxes do not take into account the nature of the information or purchased
goods. The largest number of bits on the Internet are included in children's video games in most
countries, where businesses are developed, tax-exempt or taxed at the lowest rate. It is also unclear
which government will take over taxes that are the result of cross-border data flows. In addition to
security issues, the problem of unclear taxation models of commercial transactions on the Internet
certainly inflicts great torture for fiscal experts around the world.

BENEFITS AND JUSTICE ELECTRONIC TRADE

The main characteristic of e-commerce is a deep and very rapid change in the way trade is done.
Today, e-commerce has many advantages over traditional commercial transactions. The use of e-
commerce extensively generates new profits. A set of interactive, content-rich and personalized
messages can be sent to specially selected consumers to increase sales. Companies now have more
information than ever before, allowing them to use this information as efficiently as possible,
segment markets and adapt their products or services to potential customers or users of the best
service possible.

The impact of e-commerce is mainly expressed in industries engaged in the production of

computers, software and computer equipment and other elements necessary for the realization of
e-commerce. E-commerce has enabled companies to choose suppliers worldwide regardless of their
geographic location, and to sell and market their products or services anywhere in the global
marketplace.

Compared to traditional trading, the advantages of Internet commerce are numerous because of the
unnecessary nature, as well as window dressing, the sales staff is reduced to a minimum, there is the
possibility of worldwide sales, instant communication, presentation of an interactive multimedia
catalog that can provide the customer desired information There are classic catalogs and postal
submissions), promotions are much cheaper, easier to achieve publicity on the internet, there are
more opportunities to adjust to customer needs, and with all that, Allows purchasing more easily
done from armchairs, indefinitely (Without stopping), without affecting the sales staff in decision
making and other benefits.

Due to the complexity of electronic trading problems systems in sales or purchases over the Internet
may occur. The problem refers to the fact that many potential customers still do not have Internet
access or do not use it, some do not have a fast internet connection, online purchases involve a lot
of confidence, privacy is distracted and there is a real existence problem from Stores on the Internet.
The Internet is a public network that can be accessed by everyone, and therefore there is the
possibility of someone monitoring the communication without permission and misuse it later. For
this reason, a mechanism that ensures information protection, information integrity and authenticity
should be found.

Cryptography is a science that deals with methods of maintaining the confidentiality of information
and which has its own features such as encryption, decryption and keys. Defining and verifying the
identity of the sender is accomplished by using digital signatures and certificates. The purpose of a
digital signature is the authentication of the message content, as well as the delivery of the message
sender's assurance.

With the emergence of the internet a lot has changed in terms of business and commerce. Once the
operation is based on the principle of face to face, but now with the emergence of Internet
participants in the trade do not need to know, do not meet and see each other. With the advent of
e-commerce there are no longer geographical boundaries, language limits and currency limits. In
modern business there is a transition from the business to electronic phase, which leads to technical
penetration of faster trading progress. Come to the development of an electronics store, which has
significant benefits for the end consumer, but there are new issues related to payment and security
of transactions made in this way.

E-commerce and e-business are becoming inevitable every day. Paper, pencils, stamps and other
equipment are replaced with computers and the internet, thanks to an easier and better way to
increase the number of business transactions. Online purchases and e-commerce are growing very
fast, opening new business opportunities, which affect productivity gains, cost reductions and faster
capital turnover. E-commerce creates employment opportunities, stimulates economic growth,
investments in innovation, new technologies and knowledge, which contribute to the emergence of
new operators in the market.

BIBLIOGRAPHY

Krsmanovic B polic S. (2012) Digital Economics, materials from lectures, University of East Sarajevo,
Faculty of Business Economics Bijeljina.

Milicevic V (2002), Internet economics, Faculty of Organizational Sciences (FON) Belgrade

Milosavljevic M, Grubor G, Veinović M, (2009), Computer Management, Singidunum

Stankić R Krsmanovic B (2007), Electronic Commerce, Bijeljina Foreign Trade Faculty

Scripts for electronic trade entry exams (2009), FON, Belgrade.

Electronic multipoint business Uros T (2006), school, polsovna Belgrade.