Mercantile Models From The Merchant's Perspective

•To better understanding, it is necessary to examine the order management cycle (OMC).
•The OMC includes eight distinct activities.
•The actual details of OMC vary from industry to industry and also for individual products and services
•OMC has generic step
      (i)   Order planning & Order generation.
     (ii)  Cost estimation & pricing.
     (iii) Order receipt & entry.
     (iv) Order selection & prioritization.
     (v)  Order Scheduling
     (vi) Order fulfillment & delivery.
     (vii) Order billing & account/payment management.
     (viii) Post sales service.
 
Order planning & order Generation
•Order planning leads to order generation.
•Orders are generated in a no. of  ways in the e-commerce environment.
•The sales force broadcasts ads (direct marketing), sends personalized e-mail to customers (cold calls), or creates a WWW page

Cost Estimation & pricing
•Pricing is the bridge between customer needs & company capabilities.
•Pricing at the individual order level depends on understanding the value to the customer that is generated by each order, evaluating the cost of filling each order; & instituting a system that enables the company to price each order based on its value & cost
 
Order Receipt & Entry
•After an acceptable price Quote, the customer enters the order receipt & entry phase of OMC.
•This was under the purview of departments variously titled customer service, order entry, the inside sales desk, or customer liaison.

Order Selection & Prioritization
•Customer service representatives are also often responsible for choosing which orders to accept and which to decline.
•Not, all customers orders are created equal; some are better for the business.
 
Order Scheduling
•In this phase the prioritized orders get slotted into an actual production or operational sequence.
•This task is difficult because the different functional departments- sales, marketing,, customer service, operations, or production- may have conflicting goals, compensation systems, & organizational imperatives:
     Production people seek to minimize equipment changeovers, while marketing & customer service reps argue for special service for special customers.
 
Order Fulfillment & Delivery
•In this actual provision of the product or service is made.
•It involves multiple functions and locations.
 
Order Billing & Account/Payment Management
•After the order has been fulfilled & delivered, billing is given by finance staff.
•The billing function is designed to serve the needs and interests of the company, not the customer.

Post-sales Service
•This phase plays an increasingly important role in all elements of a company’s profit equation: customer, price, & cost.
It can include such elements as physical installation of a product, repair & maintenance, customer training, equipment upgrading & disposal.•The newest technologies are direct deposit of payroll, on-line bill payment and telephone transfers

•The technology for paying bills, whether by computer or telephone, is infinitely more sophisticated than anything on the market a few years ago

•In 1980s were the days of “stone age” technology because of technology choices for accessing services were limited

•For home banking, greater demands on consumers and expanding need for information, it’s services are often categorized as basic, intermediate and advanced

Basic services

•These are related to personal finance
•The evolution of ATM machines from live tellers and now to home banking
•The ATM network has with banks and their associations being the routers and the ATM machines being the heterogeneous computers on the network.
•This inter operable network of ATMs has created an interface between customer and bank that changed the competitive dynamics of the industry. See in next figure
•Increased ATM usage and decrease in teller transactions
•The future of home banking lies with PC’s

Intermediate Services
 
•The problem with home banking in 1980 is, it is expensive service that requires a PC, a modem and special software

•As the equipment becomes less expensive and as bank offers broader services, home banking develop into a comprehensive package that could even include as insurance entertainment

•Consider the computerized on-line bill-payment system

•It never forgets to record a payment and keeps track of user account number, name, amount and the date and we used to instruct with payment instructions. See in Fig;