Analysis of Supplier Competition in Electronic Marketplaces

| The advent of e-business heralds new opportunities and challenges for buyers and sellers in business-to-business commerce. The electronic trading reduces transaction and search costs and reduces other market ineeciencies. The electronic trading also shortens supply chains and lowers inventory carrying costs. On the other hand e-business increases supplier competition, reduces prices, and lowers the proot margins. Our study shows the potential bene-ts that accrue for the suppliers can ooset the shrinkage of proot margins.