e-Business Models & Applications: Types, Workflows & Real Cases

Core Concepts: What is an e-Business Model?

An e-business model defines how a company creates, delivers, and captures value using digital technologies. Unlike traditional business, e-business models leverage internet, mobile apps, cloud computing, and data analytics to reduce costs, expand reach, and personalize customer experiences.

Key Characteristics of e-Business Models

10 e-Business Models with Nepali & Global Examples

Use this comparison table to memorize the differences quickly:

Worked Example: How Daraz (B2C + C2C Hybrid) Makes Money

Daraz operates as a multi-model marketplace:

1. B2C: Sellers (e.g., Himalayan Java) list products → Daraz takes 10-15% commission per sale.
2. C2C: Users sell used goods (e.g., SastoDeal section) → Daraz earns 5-10% fee.
3. Ads: Sellers pay for promoted listings (like Amazon Sponsored Products).
4. Logistics: Daraz Logistics charges flat-rate shipping (e.g., Rs. 200 for orders under Rs. 1,000).

Real Calculation:

• A seller lists a Rs. 5,000 laptop with a 12% commission.
• If sold, Daraz earns: 5,000 × 0.12 = Rs. 600.
• If the seller also pays Rs. 300 for ad promotion, Daraz’s total revenue = Rs. 900.

How e-Business Models Work: Step-by-Step Workflows

1. B2B Procurement Cycle (e.g., Nabil Bank Ordering Supplies)

flowchart TD
  A["Nabil Bank Needs"] --> B["Publish RFP (Request for Proposal)"]
  B --> C["Suppliers Submit Bids"]
  C --> D["Bank Evaluates Bids"]
  D --> E["Selects Supplier (e.g., Himalayan Java for stationery)"]
  E --> F["EDI Order Placed"]
  F --> G["Supplier Ships Goods"]
  G --> F["Bank Pays via e-Payment (eSewa/Khalti)"]
  F --> H["Bank Receives Invoice via ERP"]
  H --> I["Audit & Compliance Check"]

Key Tech Used:

• EDI (Electronic Data Interchange): Automates order-invoice-payment.
• ERP (Enterprise Resource Planning): Tracks inventory (e.g., SAP used by Nabil Bank).
• Blockchain: Some banks use it for tamper-proof procurement records.

2. C2C Marketplace (e.g., SastoDeal)

flowchart LR
  A["User A Lists Item"] --> B["SastoDeal Verification"]
  B --> C["User B Places Bid"]
  C --> D["Auto-Countdown Timer"]
  D --> E["Highest Bidder Wins"]
  E --> F["SastoDeal Takes 10% Fee"]
  F --> G["Escrow via Khalti"]
  G --> H["Item Shipped via Pathao"]
  H --> I["Feedback & Rating"]

C2C auction workflow with key decision points highlighted Why This Works in Nepal:

• Low trust barriers: Escrow payments (via Khalti/eSewa) reduce fraud.
• Mobile-first: 90% of Nepali users access via Android apps.
• Social proof: Ratings build trust (like eBay’s feedback system).

In the Real World

1. eSewa: G2C + B2C Hybrid Model

• G2C: Citizens pay electricity, water, traffic fines via eSewa (govt. partnership).
• B2C: eSewa earns 2.5% transaction fee (e.g., Rs. 25 on a Rs. 1,000 bill).
• Tech Used:
  • Biometric verification (for ID checks).
  • APIs (integrated with Nepal Electricity Authority).
• Impact: Reduced bribery in bill payments by 80% (World Bank study).

2. Daraz Logistics: B2B + C2C Supply Chain

• B2B: Daraz Logistics partners with Nepal Postal Service for last-mile delivery.
• C2C: Users ship personal items via Daraz Ship (like Shiprocket in India).
• Cost Example:
  • Kathmandu to Pokhara: Rs. 400 for a 5kg parcel (vs. Rs. 800 via traditional courier).
  • Revenue: Daraz takes 20% margin on logistics.

3. Nabil Bank’s Digital Loans: B2C + AI

• Model: B2C lending with AI-driven risk assessment.
• How It Works:
  1. Customer applies via Nabil Bank app.
  2. AI checks credit score (using Nepal Rastra Bank data).
  3. Instant approval (no physical visits).
• Revenue: 12% annual interest + processing fees.
• Tech: Machine learning (like Kiva’s microloan model).

e-Business Models for e-Products vs. e-Services

Case Study: Himalayan Java’s B2B + Community Model

Problem: Small coffee farmers in Pokhara struggled with low profits due to middlemen. Solution: Himalayan Java used a hybrid model:

1. B2B: Sold bulk coffee to Starbucks Nepal (via Alibaba-like platform).
2. Community: Created a farmer co-op where members got direct access to global buyers.
3. e-Services: Offered online training (via Zoom) on fair-trade certification.

Results:

• Farmers’ income ↑ by 40% (2018–2023).
• Tech Used:
  • Blockchain for transparent pricing.
  • WhatsApp Business for orders.

Advantages and Disadvantages of e-Business Models

Advantages

Disadvantages

Exam Tip: How to Score Full Marks

1. Define Clearly: Start every answer with a one-sentence definition (e.g., "A B2B model is when businesses transact digitally, such as Daraz Wholesale selling to retailers like Himalayan Java.").
2. Use Real Examples: Examiners love Nepali cases (eSewa, Daraz, Nabil Bank). Always tie theory to practice.
   • Bad: "B2C is business to consumer."
   • Good: "B2C is exemplified by eSewa, where citizens buy digital services like bill payments directly from the platform, earning eSewa a 2.5% transaction fee."
3. Diagrams > Text: Draw one mermaid flowchart per question (e.g., B2B procurement cycle). Label every step.
4. Compare Models: Use the table format to contrast B2B vs. C2C or e-Products vs. e-Services.
5. Discuss Tech: Mention specific tools (EDI, ERP, blockchain) to show depth.
6. Critique: For questions on challenges, list 2 tech solutions (e.g., "To reduce fraud in C2C, SastoDeal uses escrow payments via Khalti and AI-driven user verification.").

Common Exam Questions & How to Answer

Practice Question (Solve Like an Exam)

Question: "Explain the G2C e-business model with a Nepali example. How does technology enable this model? Discuss one challenge and its solution."

Model Answer: The G2C (Government-to-Citizen) model enables governments to deliver services digitally to citizens. In Nepal, eSewa is a prime example, where citizens pay electricity bills, traffic fines, and license fees via the platform.

How Technology Enables G2C:

1. Payment Gateways: eSewa integrates with Nepal Rastra Bank’s systems to process transactions securely.
2. APIs: Connects to NEA (Nepal Electricity Authority) and DDCs for real-time bill verification.
3. Mobile Apps: 95% of users access eSewa via Android/iOS, reducing physical visits.
4. Biometric Verification: Uses fingerprint/NID scans to prevent fraud.

Challenge & Solution:

• Challenge: Low digital literacy among elderly citizens.
• Solution: eSewa provides SMS-based payments (e.g., dialing 16006 from any phone) and agent-assisted transactions at local shops.

Visual:

flowchart TD
  A["Citizen Needs to Pay Bill"] --> B["Access eSewa via App/SMS"]
  B --> C["Biometric/NID Verification"]
  C --> D["Select Service (Electricity/Water)"]
  D --> E["API Fetches Bill from NEA"]
  E --> F["Citizen Pays via Khalti/eSewa"]
  F --> G["Government Receives Payment"]
  G --> H["Confirmation SMS"]

Tech Used: APIs, biometrics, SMS banking.