Electronic Markets

Before setting up a working definition of an electronic market (EM), let us look at the functions of markets in our economic system. According to traditional market market situation, branch or technological trends will be useful. This phase results in a list of potential partners in the market and their offer and/or demand. Phase 2: Trading. As soon as all information has been evaluated, we can proceed to contact potential transaction partners. Terms and conditions have to be fixed (terms of payment and delivery, warranties, additional service etc.). The legal basis is established for further transactions. Phase 3: Settlement. Now the physical transactions are carried out. This phase may consist of various subtransactions depending on the goods or services handled. In the case of physical goods, possible transactions might be packaging, storage, shipping, insurance, customs clearance etc. During this third phase, derivated transactions, such as purchasing forwarding services or insurance, will be initiated. The physical exchange of goods is accompanied by flows of financial transactions and information. The following definition is based on the above-mentioned concepts of coordination and on the phase model: EMs in the narrow sense can be defined as market places put into action by means of telemat-ics. They support all phases of transactions , including the formation of prices of goods and services. Consequently, they contribute to the realization of the ideal economic market as an abstract place of exchange with complete information where transaction costs do not apply. EMs are characterized by the following features: Ubiquity, for EMs are open 24 hrs every day for any user having access to the telecommunication network. Easy access to information, although information asymetries cannot be avoided completely. Low transaction costs in all phases. As the currently existing EMs are not yet actual markets offering the complete set of functions, we should use a more liberal definition: EMs in the broader sense may be understood as information systems supporting one or more phases and functions of coordination within market systems. This definition includes coordination systems beyond company level, as far as they are used by a multitude of partners with equal rights of participation on the demand side and on the supply side. projects or common marketing activities. Splitting up coordination mechanisms into markets, hierarchies and cooperations, we can clearly define information-based support systems for the market-coordination of goods and services as EMs. Which functions are important speaking of …