Brick and click business; advantages and disadvantages of online business

Concept of brick and click business

Business formats are of three kinds: brick and mortar (only physical premises), click (only online) and brick and click (both). A brick and click business combines physical stores, offices or showrooms with an online presence, a website, app or marketplace listing, so that customers can use whichever channel suits them, or a mix of both. Customers may browse online and buy in the store, order online and collect from the store, or buy in the store and arrange home delivery or returns online. Such a business is also called a clicks and mortar business; when its channels are fully linked (one stock, one customer account, order online and collect or return in store) it is called omnichannel.

It has grown because customers want both the convenience of online shopping and the trust, touch and service of a physical store. Many traditional retailers, banks and restaurant chains have added online channels, while some online-born firms have opened physical stores.

Example. An electronics chain lets customers compare models on its app, check which store has stock, try the product in the store and have it delivered home, with returns accepted at any branch.

Advantages of online business

1. Wider reach. Customers anywhere in the country, or the world, can be served without new shops.
2. Always open. Sales can be made 24 hours a day, every day.
3. Lower costs. Less spending on rent, display and sales staff; savings can be passed on as lower prices.
4. Wider choice and easy comparison for customers.
5. Convenience: home delivery, digital payment and easy reordering.
6. Customer data. Online sales generate information that helps in personalised marketing and better stock planning.
7. Quick start and easy scaling, especially for small firms and start-ups using marketplaces.
8. Direct contact between producer and consumer, cutting out some intermediaries.

Disadvantages of online business

1. No personal touch or trial: the buyer cannot handle the product and has little face-to-face help before buying, so some goods turn out unsuitable once they arrive.
2. Trust and security concerns: money and personal data travel over networks that criminals target, so a buyer may fear a fake seller or the loss of card data.
3. Delivery problems: cost, delays and damage, especially for bulky or fragile goods and remote areas.
4. Intense price competition and low customer loyalty, since rivals are one click away.
5. Technology dependence: the business suffers if the website, internet or payment systems fail.
6. Limited reach among some customers who lack internet access, digital skills or digital payment: the digital divide.
7. High marketing and return costs to attract and keep customers.

Conclusion

Online business offers reach, convenience and lower costs, but lacks the personal touch and trust of a store. The brick and click format combines the strengths of both, which is why it has become the preferred model for many businesses.