Risks and Benefits of New Online Retailing

Especially as compared with other channels, the Internet as a method for retail sales has specific advantages and disadvantages as well as opportunities and risks. When observing the characteristics of Internet commerce, we recommend taking a two pronged view – one from the business side and the other from the customer s perspec tive. Business owners thereby avoid leaving the impression of a truncated company value chain in which, correspondingly, only one partner profits from the transaction (Passenheim 2003, p. 99). In Figure 5 1, the advantages and disadvantages of the Inter net distribution channel are illustrated from the perspective of the company.