Security and Encryption

Trust and Risk

Lack of information by rural artisans

Lack of qualified personnel to work with farmers , artisans and other rural folks.

Lack of proper business models

Too slow and undependable internet

Legal Issues

Fraud and Risk of Loss

Modes of payment

Culture

Consumer Privacy

These bottlenecks are in addition to the other usual e-commerce bottlenecks like pricing structure for users by various service providers, availability of bandwidth which may be a hindrance for users to experience the real world shopping experience etc

Suggested Business Models

One of the major challenges that faces the e-commerce transactions in rural level is the lack of a proper business model. A business model is the method of doing business by which a company can sustain itself or generate revenue and specifies where it is positioned in the value chain. Some of the business models that can be adopted by e-businesses that focus on rural products are

Brokerage Model
In this model a broker or an online firm brings buyers and sellers together to facilitate transactions. It can be a Business to Business (B2B), Business to Consumer (B2C) or Consumer to Consumer(C2C).The broker will charge fee for each of the successful transaction.

Merchant Model
This is the online version of classic wholesalers and retailers of goods and services. Sales can be made through the list prices or through auctions. This model can be essentially replicated for those rural products that are unique to the web and don’t have traditional “brick and mortar” model.

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* Contributed by -
Lijo Isac,
MBA (FT), Batch of 2006,
Faculty Of Management Studies,
Delhi University, Delhi.