Industrial Training



Risk of E-Commerce

Unquestionably, e-commerce has been a positive development for many people as it has made shopping easier and more convenient, as well as provided an income for others. But the greatest problem inherent to e-commerce is the fact that the buyer and the seller do not know one another. Consequently, e-commerce can be quite dangerous.

First and most obvious is the scam side of e-commerce. Both on the part of the sellers and the buyers. Hiding behind a computer screen desensitizes people from knowing right and wrong. The idea that the other person is a world away becomes an incentive to defraud. Buyers use fake or stolen credit cards and online payment accounts or they outright lie about delivery. Many claim non-delivery or damaged goods in order to get refunds. This is turn makes it costly for sellers, as they are faced with the reality that now they have lost both their inventory and money.

On the other side, sellers have found ways to take money without ever sending any product or forwarding inferior goods in a type of “bait and switch” method. And because it is easy to get others to provide testimonials or feedback, unsuspecting customers assume the seller is legitimate. This is a huge issue, and I suggest either consulting an online business consultant or an internet expert in your inner circle when you feel something fishy is going on.

Second, even if both the seller and the consumer treat each other honestly, other negative issues can arise. When a company accepts a customer's credit card and personal data, unless the business takes measures to protect that information, data is easily stolen through hacking, making both the seller and the buyer vulnerable. Businesses experience lost sales from apprehensive customers, and customers must track down credit cards that have been used fraudulently and try to prove that they were victimized.

Third, in addition to hacking as a means of gaining sensitive information, competitors will hire hackers to take down a site (sometimes referred to as DOS – denial of service) in order to prevent customers from buying. And then, there are the jokesters who hack a site, messing it up just for the fun of it or just to prove they can do it. If you run a website yourself, make sure you have a good web host that has top notch security.

Fourth, online merchants are at the mercy of the banks and other financial institutes who process payments. Merchant accounts can be frozen or terminated without notice for high credit card chargebacks, inappropriate sales to returns ratios, excessive customer complaints, and any other perceived violation of the terms and agreements of the contract. In the meantime, money is tied up resulting in loss of income and potentially a bankrupting situation, as funds are not available to buy more stock and carry on business.

Fifth, unscrupulous employees or outsourced labor pose a major problem to e-commerce sites. Smaller e-commerce owners do not have the luxury of in-house programmers and designers, relying instead on people found on forums and classified sites. Unfortunately, now the backbone of their business is predicated upon someone who may or may not know what he/she is doing. Equally disturbing, is the fact that many have ulterior motives, adding destructive or detrimental code to the program in order to redirect customers, steal private information, take a site down at any time, and a host of other unimaginable activities.

Sixth, digital goods are rife with theft. Many online retailers are not being paid for their downloadable content due to many factors. Some of the more common reasons are:
• thieves know their way around a server and can find the document to download without paying
• one person pays for the document and lets his friends have the link to the download
• people claim “not received” or “not as advertised” and receive credits to their charge cards, leaving the seller with nothing but a bad reputation
• with the proliferation of social media sites and free download areas, any digital product is fair game.

As one can clearly see, although e-commerce was a major development for many people, there can be dangerous side effects to this business model.



Hi I am Pluto.