While some use e-commerce and e-business interchangeably, they are distinct concepts.

E-commerce refers to online transactions, mainly buying and selling of goods and/or services over the Internet. E-commerce operates in all four of the major market segments: business to business, business to consumer, consumer to consumer and consumer to business. One of the main advantages of e-commerce is that it allows for a cheaper and more efficient distribution chain for products or services.

The main difference between e-commerce and e-business is that e-business also covers internal processes such as product development, inventory management, risk management, finance, knowledge management and human resources. E-business has a more complex strategy that extends to all online interactions with business partners, suppliers and customers and aims at improved production, cost savings, reduced inventory, etc.