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Analyzing the costs of E-commerce enterprises, the paper points out that the variable costs are turned into fixed costs, and at same time transaction costs, production costs and management costs are relatively shrunk. It is shown that the transaction costs are going toward two opposite directions, both of which can increase competitive advantage. E-commerce modifies the foundation of the enterprise competition lain in mainly decreasing the unit labor cost and the cost of production design. E-commerce not only decreases the cost of holding inventory but also improves every manager abilities and amplifies their scope of management to drop the cost of management. All this helps to increase the competition edge for enterprises.
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