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Difference Between ERP and E-Commerce

  • Difficulty Level : Basic
  • Last Updated : 14 Feb, 2021

E-Commerce is a business model that allows to buy and sell goods and services over the internet. It is also known as Electronic Commerce and Internet Commerce. Also, the Transaction of money, funds are also considered as part of E-Commerce.

Some E-Commerce Software: Amazon, Flipkart, Quikr, Paytm, etc.

E-Commerce

The first-ever online sale was in 1994 when a man sold a CD by the band Sting to his friend through his website Net Market, an American retail platform. This is the first example of a consumer buying a product from a business through the World Wide Web or e-commerce as we commonly know it today.

Types of E-Commerce:



There are basically 4 main types of e-commerce models that can describe almost every transaction that takes place between consumers and businesses.

  • Business to Consumer(B2C): When a good or service is sold to an individual consumer by a business, e.g., we buy a pair of shoes from an online retailer.
  • Business to Business(B2B): When a good or service is sold by a business to another business, e.g., a software-as-a-service is sold by a business for other businesses to use.
  • Consumer to Business(C2B): When a consumer’s own products or services is sold to a business or organization, e.g., an authority offers exposure to their online audience in exchange for a fee or a photographer licenses their photo for a business to use.
  • Consumer to Consumer(C2C): When a good or service is sold by a consumer to another consumer, e.g., we sell our old furniture on eBay to another consumer.

ERP systems are the kind of software tools that are used to manage the data of an enterprise. ERP system helps different organizations to deal with different departments of an enterprise. Different departments like receiving, inventory management, customer order management, production planning, shipping, accounting, human resource management, and other business functions. It combines all the Databases across the department into a single database that can be accessed by all employees of that enterprise. It helps in the automation of the tasks involved in performing a business process.

Some ERP Marketplace: SAP, Oracle, PeopleSoft, BaanERP, etc.

ERP

Types of ERP:

An ERP system is a modular application that contains various tools for different business processes. Let’s see the most important ERP system modules:  

  • On-Premise ERP: On-premise ERP solutions are installed locally on your computer’s hardware and servers and then managed by your IT Staff.
  • Cloud ERP: It is also called SaaS, or Software-as-a-Service- is provided as a service. In this type of deployment, a company’s software and its associated data are managed centrally by the ERP vendor and are accessed by customers using a web browser.

Comparison Between E-Commerce and ERP:

                                                                  ERP                                                                E-Commerce                                                                                     
ERP Stands for Enterprise Resource Planning.E-commerce Stands for Electronic-Commerce.
ERP comprises the selling of ERP systems to various organizations and companies.E-commerce comprises with selling and buying of goods and services over the internet.
ERP system is created by vendors that are ordered by some organization. After purchase, the organization can use it.E-Commerce is available free to use. It only cost that things that are bought online.
Less user-friendly on the mobile system.More user-friendly on the mobile system.
One particular ERP system is limited to just an Organization, company, etc.Everyone can access E-commerce.
Example: SAP, Oracle, PeopleSoft, etc.Example: Flipkart, Amazon, Paytm, etc.

Types of ERP: 

  • Cloud-Based ERP
  • Server Based ERP

Types of E-Commerce:

  • Business to Consumer(B2C)
  • Business to Business(B2B)
  • Consumer to Business(C2B)
  • Consumer to Consumer(C2C)
It basically deals with Business to Business where One Business will sell their product (i.e. ERP) to other businesses.It deals with all i.e. B2B, B2C, C2B, C2C.
Data in ERP is more Secure as it is limited to only a particular organization.Data is available like Price, Rating, products, etc. freely due to this everyone can copy from it which decrease its security level.
Many ERP systems provide Business intelligence features due to this data analysis become easy.E-Commerce doesn’t provide Business intelligence Services to the Customers. 
Many ERP platforms offer built-in reports such as cash flow and income, so they can be generated without any IT assistance.E-Commerce Platform only has reporting capabilities on Marketing and Sales. In order to require more facilities, IT assistance is required.
Automation occurs in ERP. For Example: If an employee wants to print some important documents, but he is far away from the printer, so he can automate this task easily.Automation cannot occur in E-Commerce.
If a can of any fault in ERP, the organization gives feedback to the ERP vendor, and they will surely correct that fault in the ERP System.If users can face any fault then they will provide feedback for their problems, but it is not sure that those who provide an E-Commerce facility will solve the issue.
ERP System ties together with various business functions.E-Commerce Focuses only on the User or Customer’s
When an organization wants to update its ERP, ERP Vendor will cost charges to the organization.E-Commerce System is Updated freely for the Users.
All the Data of an Organization in ERP systems is Analyzed by them.All Data of User are analyzed by Producer of E-Commerce System and on the basis of this Product Recommendation and other stuff is shown to the user according to their past data.
ERP System supports credit limits or net terms.E-Commerce Platforms don’t support credit limits or net terms.
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