The impact of E-technologies on competition --river isaland Essay

The impact of E-technologies on competition --river isaland - Essay Example The involvement of e-technologies in business activities is reviewed in this paper. Emphasis is given on a particular industry, the clothing industry. The firm River Island, an important competitor in the global clothing industry is used as an example in order to explain the potential value of e-technologies for the clothing industry, especially in regard to the industry’s competitiveness. 2. The impact of e-technologies on competition – River Island 2.1. Impact on consumers The use of e-technologies in business activities has been related to a series of benefits. E-commerce is a term used for showing the network of technologies available to businesses that choose to use Internet for expanding their operations (Morley and Parker 2009). Through e-commerce consumers have a series of benefits: a) they can have access to ‘a higher range of products and vendors’ (Bushry 2005); b) they are able to make their shopping without leaving their home (Bushry 2005); the convenience related to e-commerce has been characterized as one of this scheme’s major advantage; c) as noted above, through e-commerce consumers have access to a high range of products; as a result, the range of prices involved is also high (Bushry 2005); this means that e-commerce offers to consumers the advantage of choosing among products of various prices (Bushry 2005). In addition, through e-commerce consumers are able to compare among products of different prices and identify the products of the desired price (Bushry 2005). The comparison of products in regard to their characteristics and price is one of the most important features of e-commerce (Qin 2009); it seems that due to this feature the popularity of e-commerce as a business tool has been significantly increased the last decade (Qin 2009); d) Another important feature of e-commerce is the following one: because of e-commerce consumers can have access to valuable information in regard to products/ services avail able online (Bushry 2005). This type of information would not be retrieved unless through appropriately customized websites. From this point of view, it could be stated that e-commerce has led to the increase of power of consumers, an issue that is also discussed in the next section. 2.2 Impact on Pricing & Profits The use of e-technologies can highly affect the performance of clothing industry. However, in order to understand the potentials of the industry to increase its competitiveness it would be necessary to present and evaluate the industry’s competitive environment. The Five Forces model of Porter would be used for developing this task. In the context of the above model, the global clothing industry has to face five forces: a) pressures from suppliers; there are specific countries that are involved in the global apparel industry; in fact, China and EU are the industry’s major exporters, Figure 1; still, the industry’s prices are kept at standard levels; t he industry’s suppliers are not expected to press for an increase in price, at least since the number of potential suppliers is high, as indicated in Figure 1 below. Figure 1 – Exports in the apparel industry (Source: Fernandez-Stark, K., Frederick, S. and Gereffi 2011, p.10) b) Consumers; e-commerce has allowed consumers to become more independent in regard to the review and ordering of products/ services