By Sean McCloskey
Acceptance of the Internet as a business-to-business (B-to-B) electronic commerce platform has created the opportunity for companies in all industries to streamline complex processes, lower costs and improve productivity. Over the past 10 years, companies have licensed information technology to optimize internal operations in areas such as finance, accounting, manufacturing and human resources. Today, these companies are increasingly discovering that Internet e-commerce solutions can be used between them and their trading partners to improve sales, reduce costs, and optimize areas such as marketing, order management, data capture, fulfillment and customer service.
By automating the sales and trading processes, distributors and manufacturers can:
- Capture and access real-time order and shipment information
- Produce a cost-efficient "virtual catalog" and marketing strategy
- Automate customer service and response capability
- Use the Internet to build direct sales relationships in a private Internet market.
Buyers and sellers at all levels of the product supply chain can meet directly on-line to exchange goods and services. Interactive technologies link suppliers directly to customers and industry-specific communities, significantly reducing the need for third-party broker transactions. Internet e-commerce software solutions will become as integral to manufacturers and distributors as traditional Enterprise Resource Planning (ERP) software has become over the past decade. According to a recent Goldman Sachs industry research report on B-to-B e-commerce, "B2B: 2B or Not 2B," September 14, 1999, over 50 percent of the companies surveyed responded they would implement their own electronic market to support e-commerce with their regular trading partners.
A new contribution to the B-to-B e-commerce phenomenon is a vertically focused, Internet-based, fully automated and scalable suite of services. These services allow manufacturers and distributors to market and sell surplus inventory in an industry-specific vertical marketplace, while transitioning their daily intercompany business processes into a more efficient, automated e-commerce solution to facilitate sales and distribution with their existing customers within a private electronic market.
Targeting Surplus
SurplusBIN.com is an Internet-based B-to-B vertical electronic market for buying and selling surplus inventory in the electronics, automotive and industrial marketplaces. It is a frictionless market designed to meet suppliers` needs to dispose of surplus in an efficient and profitable manner. Its unique Internet platform unites interested buyers and sellers in industry-focused communities. Participants can post large-scale product offerings electronically and privately conduct surplus inventory transactions. In the future, buyers and sellers will also be able to participate in on-line auctions.
By using this service, companies of all sizes can optimize their supply chain of excess stock, odd lots, and used or obsolete parts in an interactive electronic market environment. Each community focuses on a single industry segment and caters to the specific business needs of individuals within that community. The reach of suppliers is expanded beyond their current regional territories into new, global markets. Thirty different categories of electronic surplus inventory are available.
The administrative cost of acquiring surplus inventory through direct transactions between buyers and sellers will be lowered. Future offerings will include assisting companies with logistical management, such as arranging for the shipment and storage of surplus inventory; verification services to test and ensure that the surplus inventory meets industry quality standards; and financing services to facilitate transactions between unknown buyers and sellers.
Each of the vertical markets provides buyers and sellers with features specifically designed to:
- Electronically catalog and transfer large product offerings
- Locate surplus products with a search engine "filter" that identifies inventory according to industry-standard product descriptions and specific product characteristics
- Create time-sensitive product offers according to price, supply or other factors
- Coordinate for the testing, storage, transport and financing of orders
- Search for a particular product, 24 x 7, using a virtual "buying agent" that notifies the buyer by e-mail when the product is found
- Manage orders and auction items for sale.
Embracing Trading Partners
E.MBRACE is a software-service platform that enables suppliers to support their own private-labeled trading partner electronic market to sell and distribute inventory directly to long-established trading partners. This scalable, fully automated solution acts as a central access point to conduct private sales transactions over the Internet in order to improve operating efficiencies, reduce marketing and advertising costs, streamline product distribution, and capture strategic sales data on a real-time basis. The system can maintain a virtual product catalog, capture sales data, process simultaneous requests for information and orders on a daily basis, and integrate with a company`s back-office legacy business systems. These features were designed for companies in the electronics, automotive and industrial markets that have large product offerings and high sales volumes across a diverse customer base.
Integration of the Two
The two systems can be integrated to permit companies to complete private or public sales transactions with customers by shifting product listings between the direct trading partner electronic market and surplus inventory portals. Companies can interact in both environments simultaneously and automatically transfer the avail- ability of goods from their trading partner electronic market to the B-to-B vertical electronic market based on strategic inventory and pricing decisions.
SEAN MCCLOSKEY is president and CEO, NetVendor Inc., 3525 Piedmont Road N.E., Building 6, Suite 300, Atlanta, GA 30305; (404) 836-7836; Fax: (404) 836-7886; Web site: www.netvendor.com.
