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For the MRC platinum e-commerce merchants, 14 percent of their on-line order flow requires a manual review before acceptancehalf the 28 percent average in the overall sample and consistent with the 14 percent among other large merchants. We leverage our business, operational and technical experience and insight on behalf of our clients. The combined results show MRC platinum merchants setting the pace for the e-commerce industry in controlling fraud and protecting valid customer orders. The risk management is an important component of a IT. The web developer you hire should ensure that your website has standard security protocols in place, such as an SSL certification and Data Encryption. 7. Your risk management plan is one that is constantly evolving throughout the course of the project life cycle, from beginning to end. A risk matrix is a visual diagram of the risk analysis. Other important measures are: Do NOT charge your prospects until you are confident that all the ordered items are shipped Do NOT ship wrong products Minimize the incidence of clerical errors in billing. There are servers out there that already sell ready-to-use websites. Our entrepreneurs will be able to actively cooperate with world players, which will subsequently help to rapidly develop e-commerce in Kazakhstan. SHENTON HOUSE 5. Credit Card Scams What's The Solution? The information gathered from various sources was subjected to quantitative measurement and descriptive statistical analysis to assess the overall role of risk management and features integrated into risk mitigation strategies to promote efficiency in e-commerce trade. Buketov Karaganda State University, Bauyrzhan Yessengeldin, Kazakh University of Economics, Finance and International Trade, Zhibek Khussainova, Academician Y.A. It helps businesses to learn the magnitude of threats and shed light on them. On-line merchants do not have the ability to ask to see a drivers license or match a signature, so they need to have systems and tools to review information to authenticate the customer in real time. A risk matrix is a visual diagram of the risk analysis. Its hardly an exaggeration to say that e-commerce saved many lives (and the retail industry) during the COVID-19 pandemic, allowing consumers to buy groceries, clothing and other essentials from the convenience and safety of their homes. To guarantee your businesss long-term survival, use a risk assessment matrix to quickly identify what could go wrong and estimate the potential damage that could arise from the event. From 2020, it is planned to conclude a contract with a large electronic platform Alibaba. Vulnerability of information assets can lead to various adverse outcomes that impact integrity, authenticity, accountability, reliability, and confidentiality of information negatively (Kurnia et al., 2015). One of the principal features of international business is the risk management process, which comprises several risk management plans combined. It helps businesses to learn the magnitude of threats and shed light on them. 2. Retrieved from https://www.government.kz/ru/news/press/mintorgovli-i-integracii-rk-usilit-mery-po-zashchite-prav-online-pokupateley, . E-commerce in Kazakhstan is gradually gaining momentum. Take your time to identify the risks most likely to impact your business, and then think of ways to react to these situations. You could also encounter system failures, such as a server crash and errors on the payment site. Loss prevention does not have a one-size-fits-all solution. Have there been significant changes in ownership of the company recently? High-end luxury item retailers are only one segment of the MRCs diverse merchant membership. Therefore, always perform a legal intellectual property audit and safeguard yours by registering it. For this project, you will build upon the e-Commerce Risk Analysis performed in Project #2. Last year, there were an estimated 65,000 successful ransomware attacks one every eight minutes, on average and experts predict that it will only get worse. The Merchant Risk Council began as an informal group of merchants meeting to discuss the overwhelming increase of Internet fraud. When organizing access to the electronic platform, there are frequent technical failures of IT systems among the players of the e-commerce industry. The results of the survey conducted by the statistics Committee of the Ministry of national economy of the Republic of Kazakhstan (2017) show that the participants of the e-commerce market focus not only on financial (34.4%) and business (34.3%) risks, but also risks related to information security (18.2%). Fundamentally, these risks relate to information security, fraud, e-commerce legislation, or payment methods, and they are generally referred to as cyber-security risks. To ensure your online business survives and carries on after such disasters, you should have the right protection in place. Listen to this Cooperation and information are the keys to a long-term solution. This will help you get an idea of areas of improvement and will allow you to critically determine how scammers could potentially hack or commit fraud on your e-commerce site. Elimination of critical barriers to e-commerce will lead to continued evolution of this type of business in future as the world continues to embrace internet technology at a rapid rate. Its primary function is the identification of your e-commerce brand's overarching goals and achieving those goals through the management of the brand . Running a Risk Assessment of Your eCommerce Business, . Before setting up shop, you should enforce additional layers of network security, including a secure firewall. Loss, in itself consists of expected and unexpected components. If your customers make large volume orders and you don\'t have enough stock, you can end up losing money and having dissatisfied customers. To take it one level further, e-commerce players need to prepare their response to a range of catastrophic risk scenarios. Unauthorized access accounts for a significant amount of data loss. Some conflict points include late delivery, wrong product delivery, failure to meet expectations, and accidental double charge. This project risk management plan is usually part of the business plan created at the start of the project. Poor Customer Service What's The Solution? Factor Numeric Score 1. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you. Copyright 2022 Loss Prevention Media. Everyone within your organization must have an understanding of the security risks or fraud that involved in an e-commerce transaction or business. - Phase 2: Preparation of Website Outline. Remember that how you deal with customers will reflect on your brand. Published to help Canadian clients make better decisions about risk management and insurance programs, Aons report finds that the market continues to remain complex. Hackers, thieves, and frauds can easily use a credit card that is not theirs to complete a transaction with your business. This can lead to lawsuits and penalties. The criminal then orders items, usually high-end ones such as computers, and quickly maxes out the credit line. Other challenges include misdelivery and late shipment. The key parts of the threat-identification phase include the following: Identify and recognise different threats. In response to the fluidity of consumer preferences and the competitive landscape, e-commerce retailers have been well positioned to adopt agile practices and quickly recalibrate their business models to meet changing consumer expectations. Successful operations of companies that execute their business through the online platforms must involve development of effective strategies that will improve their capacity to respond to impending threats. Unpredictable Consumer Behavior - Online channels will certainly see a growing share of consumer traffic relative to in-person stores. Risk Management of Legal Issues affecting E-Commerce Introduction Risk management is the ability to identify, assess, and prioritize . Assurance of confidentiality, integrity, and authenticity of information relating to online transactions is a major challenge facing the risk managers in e-commerce firms (Toleuuly et al., 2019). Climate change is here, its consequences are becoming clearer, and it will not get any better soon. This knowledge will help you make informed predictions and avoid increasing risk exposure. Taxation. Many businesses are now specializing in online transactions, seeing a plethora of opportunities. It shows the threat as a graph, ranking the risks by probability and significance. In the U.S. alone, e-commerce sales increased by 42% from the previous year and accounted for 13.6% of total retail sales in 2020. Good anti-virus and turning on firewalls will diminish the chances of getting your systems attacked. Enterprise risk management (ERM) is a firm-wide strategy to identify and prepare for hazards with a company's finances, operations, and objectives. Merchants in the survey indicate about half their Internet fraud comes in the form of chargebacks, with fifty percent of the platinum merchants reporting chargeback rates of 0.15 percent or less. In accordance with the state program Digital Kazakhstan (2017), the share of e-commerce relative to retail trade ought to be 5% by 2025. Every week, we'll be sending you curated materials handpicked to help you with Digital Marketing. For instance, if competitors slash their prices, you need a ready response plan to deploy quickly. Here are some of the ways to manage your e-commerce risks: 1. For example, the severe risks are on one end, the moderate ones in the middle, and the low ones on the other. E-commerce management is the practice of managing an online business, so it's successfully achieving its goals of quality product, customer acquisition and customer retention. Accepting risk is important and putting plans in place to mitigate this risk is a core part of project management. E-commerce taxes are complex and confusing since they vary across different delivery locations. SINGAPORE (068805), 2002-2022 Allied Business Academies. Common examples of security threats include hacking, misuse of personal data, monetary theft, phishing attacks, unprotected provision of services, and credit card frauds. In fact, there is an infinite number of things that might prevent you from achieving your goals when working on a project. It is common for e-commerce websites to deal with stolen credit card information. In businesses like retail or travel, this is significant. The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes. Anyone who has worked in customer service and retail will tell you this. 1) Risk management is relevant to all organisations (public and private, large or small). Take note of market trends, fads, and consumer behavior. 5: Shopware 4 Frontend Demo Shop Illus. E-commerce is a monolithic industry. Risk assessment is part of the risk management process. Everything is going digital. According to the statistics Committee of the Ministry of national economy of the Republic of Kazakhstan (2017), the share of e-commerce in the total volume of retail trade of the country in 2017 is amounted to 1.20% (Table 1). In this dynamic risk environment, e-commerce players must protect their reputation with a proactive customer service strategy and shape their digital identity to appeal to a new and more critical generation of online consumers. The group evolved into the leading not-for-profit trade association for merchants, vendors, and e-commerce risk management professionals. Additionally, adoption of sophisticated information management systems in e-commerce firms is meant to improve security of their databases in order to minimize malicious attacks that threaten their critical infrastructure significantly (Raghavan et al., 2017). - Phase 4: Website Designing. In a worst case scenario, the victim reships the package to another country. However, like any other business, establishing an E-commerce business comes with risks. 4. For a business model that revolves around customers being able to place an order 24/7 and expect next-day or even same-day delivery, it becomes even more crucial to monitor and mitigate any supply-chain and distribution risks. Focus on the risk posture on your retail business and implement the necessary controls to improve the sustainability of your business. It should be a part of the culture of the organisation, with a programme and an effective policy led by top management with transparent responsibilities laid down for every manager and employee to be involved in the management of risk. Client Disputes And Refunds What's The Solution? 5 Inevitable E-Commerce Risks You Should Watch Out For Online Insecurity. Customer Disputes. ERM follows a very distinct and ongoing process, where it actively identifies and reassesses the various strategic and major risks to ensure financial security for businesses. Fifty percent of platinum merchants report a fraudulent order rate of 0.25 percent or less. Privacy Policy. Starting small and not jumping the gun at the slightest hint of success is critical. It goes without saying that you should only sign up with a legitimate courier service. E-Commerce Risk Assessment Checklist. Tools and solutions. Risk management is the most crucial feature of e-commerce business, which is the main focus for both customers and companies. The main categories of risks are assumptive risks and operational risks. We will start this course with a brief overview of the project manager's responsibilities and the role of the risk management plan in the overall project plan. E-commerce has become a major trend of the contemporary economy where businesses have significantly shifted their transactions to online platforms in order to take advantage of the global market. Parviainen et al. We BUILD online solutions that GROW businesses that CONVERTvisitors into customers. Platinum merchants in the survey report an average of 0.6 percent of their total revenue is lost to on-line fraud, compared to 1.4 percent for the overall sample and 1.0 percent for other large non-member merchants with greater than $50 million in e-commerce sales. Finally, it is crucial for merchants to speak to their peers about Internet fraud. Customer satisfaction is essential to the survival of your e-commerce website. Many threats are present in the digital universe. E-commerce platforms have taken the entire world by storm. Impact assessment of the Operational risks, liquidity risks and strategic risks at the company termed herein as Manageable risks, can be assessed as follows. Just like a brick-and-mortar store, vendor disputes can be quite tricky. General retail insurance policies may also cover inventory damages. ; The Forrester Wave Strategic Portfolio Management Tools, Q1 2022 Since there are many similar businesses to yours, you may unknowingly use a logo, motto, slogan, or product description related to another company. Most of them rely on age-old SEO tactics thats been out phased by Google, i.e., cloaking and keyword stuffing. E-commerce, Risk Management, Information Security, Business. Color codes are utilized in a risk matrix to increase visibility, help businesses track threats, and improve decision-making. - Phase 5: Construction. The most notable difference is in order velocity monitoring. CyberRisk - The most obvious risk to e-commerce solutions is rising cyber threat. For example, the severe risks are on one end, the moderate ones in the middle, and the low ones on the other. However, like any other business, establishing an E-commerce business comes with risks. Risk associated with any event has two components, loss severity and loss probability. Assumptive risks are the assumptions you make when planning your venture; they include estimates of; You need to test and validate your assumptions if you are new in the E-commerce sector. However, getting it to rank on top of Search Engine Results Pages and increasing its online visibility is an exhausting task that is best left for the professionals. In this Assignment I will be advising a start-up e-commerce company, by the name of CyberCash Ltd, who intend to create a software for transferring money. It can be changed along the project but is initially created by a project manager and all involved stakeholders. Understanding eCommerce attaches great importance to protecting your personal data and your right to self-determination about information. Risks range from hacker attacks, data breaches, website downtime, and price competition to compliance violations. Office of Risk Management Office of the Secretary, Office of the CFO/ASA U.S. Department of Commerce 1401 Constitution Ave., N.W. E commerce Market Climate In 2019, the global ecommerce market. Some of these threats are serious enough to warrant strong countermeasures, while others are less significant. E-commerce: course to double. Because retailers are entrusted with consumers' financial and personal information, businesses are concerned with the potential release of confidential customer, employee and corporate information, which could be exploited for identity fraud, financial theft or brand reputation damage. Some of these threats are serious enough to warrant strong countermeasures, while others are less significant. 3 Competitive Pressures - The low barrier to entry presents both an opportunity and a threat to new e-commerce solutions. This process will act as a basis for your risk mitigation plan. Scrum Our team is e-commerce projects management using Scrum. The success of E-Commerce Projects comes primarily through strong business plan. The application of big data in managing risk can prove useful in various industries including e-commerce, manufacturing, retail and healthcare and can be used in a wide array of corporate threats, including regulatory risk and business impacts. 1 1 1 3. While not all merchants will require the same high level of risk management and fraud prevention as companies selling high-ticket items, any organization utilizing an e-commerce sales channel can benefit from the shared knowledge and experience of these member merchants. Basically, it is the practice of applying various skills, tools, techniques, and approaches as well as performing various activities aimed at the effective development of an e-commerce project. One SEO case study stated that a website could increase by 313% increase with organic traffic. Retrieved from https://stat.gov.kz/official/industry/17/statistic/5, . Some conflict points include late delivery, wrong product delivery, failure to meet expectations, and accidental double charge. The technical storage or access that is used exclusively for anonymous statistical purposes. ERM allows managers to shape the firm's overall. Most retailers have the detection, investigation, and fixing processes down pat but are less prepared to respond in a timely manner. Has the e-commerce site URL been submitted to the major search engines? It helps businesses to learn the magnitude of threats and shed light on them. Platinum merchants in the survey reject an average of 2.2 percent of incoming orders on suspicion of Internet fraud, compared with 4.1 percent in the overall sample and 4.8 percent for other large merchants. is necessary to guarantee that you do not encounter any issues in the future. Postal Inspectors to help investigate, apprehend, and prosecute cyber criminals. These automated systems, which flag suspicious patterns in the order flow, are in place at 88 percent of the platinum e-commerce merchants surveyed, compared with only 33 percent of the overall merchant base and 57 percent of other large merchants. All you have to do is choose a template and fill it up with your products, services, etc. Then, you can either reduce your price, market your product as superior, or give your buyers incentives. (image will be uploaded soon) Strategies of Risk Management and its Processes. E-commerce risk management must also be tailored for each merchant to reflect business objectives and markets served. E-commerce businesses are in constant danger from hackers, credit card fraudsters, extortionists, phishing attackers, and other cyber criminals. To address and simplify this issue, there are three important steps and these are as follows: Step 1: Categorize. Volume of retail trade, total, in thousand tenge, Risks associated with information security (distrust of the population), Risks associated with the protection of personal data of buyers. 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