Types of E-Commerce Models: Market Place Model and Inventory Model of E-Commerce

There are two types of E-commerce Models :

1) Marketplace Model
2) Inventory Model

So Let's have a look on them.

1) Market Place Model:- “Marketplace model of e-commerce means providing of an information technology platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller.”

For Ex. Amazon, Snapdeal, Flipkart etc.

The main thing is that when we purchase something at Flipkart, Flipkart buys the same thing from a registered seller and then sends that to us. Flipkart does not directly sells that from its own store. So Flipkart just acts as a interaction Platform or mediator between the buyer and the seller.

2) Inventory Based Model:- “Inventory model of ecommerce means an ecommerce activity where inventory of goods and services is owned by e-commerce entity and is sold to the consumers directly.”

In this case Flipkart would have directly sold the Product from its own store. Flipkart would have acted like a Seller only.

So in this model the E-commerce Platform actually manages an inventory or stock of Products.

Example of this is Alibaba in China which is following the Inventory model.

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