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by A Nissansala M. Medagama, Assistant Lecturer, Department of Commerce, Faculty of Commerce Management Studies, University of Kelaniya.

Electronic Commerce or e-Commerce, is popular jargon in a business environment. With the advent of the Internet and Telecommunication Technology, e-Commerce, the use of the internet to conduct business has been recognised as a key business strategy for many firms worldwide. e-Commerce has changed the business world.

Business that has a physical and online presence is called "click-and-mortar" while those without a website are called "brick-and-mortar". The barriers of time and distance that retarded traditional business dealings is virtually eliminated with the introduction of e-commerce.

Most business houses accept a web-based approach because it leads to increased customer satisfaction and business adventure in the competitive marketplace. Companies such as 'ebay' are succeeding on the internet and forcing other companies to consider a jump to cyberspace. The internet is essentially a community or gathering place. We visit the internet to get, give or exchange information. The web attracts corporations which advertise or sell goods and services. Selling has become easy through 'banner advertising'.

The big buzz about e-commerce today is the substantial cost savings that would occur if a business' transaction is entirely electronic. If a company uses computers extensively to perform internal functions such as creating journal entries; sending purchase orders, confirming shipments such companies are said to be "e-commerce ready or capable".

The terms ERP (Enterprise Resource Planning) describes the modelling of the operations of a business by back-office software. The objective is to eliminate multiple systems and in-between links by implementing one integrated solution. Most ERP software does not integrate well with other systems due to non-establishment of a common standard which is accepted by all software companies.e-Commerce transactions are different in their nature. Depending on the parties concerned in a transaction e-commerce can be categorised.

B2C (Business-to-customer e-commercial), B2C (Business-to-business e-commerce), Intrabusiness e-commerce.

Most B2C e-commerce consists of the sale of goods to public. Goods can be physical objects such as books, flowers and computers. They also can be intangible things such as subscribing to online magazines, downloading software, participating in online classes. In addition companies such as financial and investment companies, travel agents, Internet Service Providers (ISPs) provide services online to consumers.

According to findings the types of products and services available in the B2C market consists of hobbies, consumer, electronics, consumer services, tourism and travel related services, healthcare and personal services. Under B2C e-commerce there is a small segment called C2C (Consumer-to-consumer). C2C business consists of site such as online auctions where individuals can connect with other individuals.

A large portion of e-commerce revenue is earned from e-commerce transactions that take place between business. The B2B market is expanding at a much faster rate than the B2C market. In B2B market products and services such as computers, retail distributions, professional services, office equipment and supplies, training and education are exchanged between businesses.

Specialised organisations in financing, warehousing and shipping, information supplying and assure their online presence to provide their services to businesses. Establishment of a B2B solution requires a significant investment of money and time. Further it is essential to have a better understanding at the technological and managerial challenges surrounding e-commerce.

In addition to commerce transactions among business, e-commerce and included within an organisation.

Intrabusiness e-commerce refers to the use of web-based technology to handle electronic transactions that takes place within a business. Such e-commerce activities does not generate revenue but results in business savings due to the organisation operating efficiently.

Recently interest was shown by exporters and importers towards e-commerce. The cyber mall "Avakasakade" has around 86 companies registered in it and whose products can be purchased online.

But due to several constraints such as limited internet access only in urban areas, poor quality training programs, non-existence of effective IT related laws, low level of confidence put on security and encryption issues in e-commercial activities by local companies stands as barriers in the development of e-commerce in the country.

But with the introduction of new electronic delivery channels in several sectors such as banking, telecommunication the effect of certain barriers can be reduced. As e-commerce had become a determining factor of a businesses' survival in the market in Europe and other areas of the world, Asia will have to follow suit and as a result it is essential for Sri Lankan companies especially small and medium-scale businesses to realise the importance of becoming e-commerce compatible.

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