Risks of eBusiness

Ecommerce is a fantastic way for businesses to connect with customers around the world in a way that has never before been possible. Yet, that is not to say that ebusiness does not have risks that entrepreneurs must be aware of before setting up a presence online. Security is the most obvious risk, as online merchants will be handling and storing sensitive information. However, a misunderstanding of the ecommerce world--how much time, money and planning it takes--is often the downfall of merchants as well. Finally, technology is key to securing the smooth transactions of ebusiness.

Security

Security is the most obvious risk for any online merchant. Online merchants are responsible for handling their customers' information in a safe manner. This means investing in multiple layers of security. Information must be encrypted throughout the transaction, secure socket layers are needed to ensure that it is sent only to authorized parties, and firewalls and the Kerberos protocol ensure that the information is protected, once it is in the emerchant's server, from internal and external attacks. . Obviously, information is vulnerable at any point in this chain, and hackers are becoming more sophisticated, so ebusinesses must ensure that all their protections are up-to-date and working to the fullest capacity. Consumers that do not feel that their information is secure will shop elsewhere.

Misunderstanding

Another big risk of ebusiness is the incorrect assumptions many beginning online merchants make. Myths about ecommerce abound. People think that it does not take much time or money. They think they can just set up a website and consumers will find them, without spending money on advertisement or having a strategy in place to attract and retain customers. They think they do not need to provide customer service and that profits will appear almost instantly. Obviously, none of these myths are true. If online merchants believe them, they will likely fail because they will not invest enough time and money to plan out their websites and see them through the difficult, beginning stages when profits and customers are hard to come by.

Technology

Finally, technology itself poses a risk to ebusiness, simply because ecommerce is so dependent on it. Infrastructure problems, such as a server malfunctioning, can shut down a website. Likewise, viruses can delete valuable data, and software glitches can keep a site from working properly. Of course, outside attacks from hackers, who want to steal sensitive customer information or deface a site, is also a risk that ecommerce merchants must try to guard against. Online consumers are quite fickle, and if they perceive a problem with a company's website even once, they might never return.

Terry Mann

http://www.ehow.com