| With the rapid development of Internet, e-commerce has further integrated into people's lives. The rapid development of B2C business brings the majority of consumers a new consumption mode. Consumers'shopping style has gradually changed from the traditional physical store to online shopping. However, compared to the traditional mode of shopping, the rapid development of B2C model brings a lot of unavoidable problems. Due to the virtual feature of network space, it is difficult for consumers to distinguish firms'fraud on the internet. The government's regulation is playing an increasing important role in the e-commerce market. Secondly, unlike the traditional mode of shopping, one of the most important parts of B2C business is the logistics, by which the network products must be delivered from firms to consumers. The convenience of logistics has greatly influenced the satisfaction of the consumers. Logistics become the bottleneck of the development of many B2C firms. At this point, self-built logistics has become an option for many large B2C firms.This paper consists of three parts. In the first part, it focuses on the EM2C (i.e. Electronic Manufacturers to Consumer) model of B2C business. The research proposes a "fraud-regulation" model between the regulators and the EM2C firm, in which output price follows a geometric Brownian motion. The study discusses the fraud activity of the EM2C firm under two types of regulation: "penalty" and "permanently closed", with real option approach, then it discussed the availability of regulation. Based on this model, the second part analyzes the exit behavior of the firm, and point out no regulatory price range. Considering the problem of building logistics platform, the last part analyzes the firm's value when it has a self-built logistics. Comparing to the value with only production and transaction platform, this paper provides an investment strategy of the firm for building logistics platform with real option approach. |
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