Question
Distinguish between inventory-based and marketplace-based e-tailing models. Use examples like Amazon or Alibaba to illustrate your answer.
Answer :
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Inventory-based e-tailing models involve the retailer owning and managing the stock they sell. In this model, the e-commerce platform directly purchases products from manufacturers or wholesalers and sells them to consumers. The retailer is responsible for warehousing, inventory management, and shipping. Amazon originally adopted this model for many of its product categories, where it purchases goods in bulk, stores them in its warehouses, and delivers them to customers. This model offers the retailer greater control over pricing, quality, and shipping times but also requires significant capital investment in inventory and logistics. On the
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