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Group 2 B2B Exchanges

Group 2 B2B Exchanges. Timothy Brasher Tamira D. Meier Stephen P. Nicholas. B2B Exchange. Worldwide: B2B market for services projected to grow from $403 billion (2000) to between $2.4 to $7.29 trillion (2004)

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Group 2 B2B Exchanges

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  1. Group 2B2B Exchanges Timothy Brasher Tamira D. Meier Stephen P. Nicholas

  2. B2B Exchange • Worldwide: B2B market for services projected to grow from $403 billion (2000) to between $2.4 to $7.29 trillion (2004) • B2B e-commerce represents 7% of forecasted $105 trillion of total global sales transactions • All businesses will eventually buy on, sell on, host on or be marginalized by an exchange www.neonultra.com/b2b_b2c_b2g.htm

  3. B2B Exchange Forecasted B2B Revenues Worldwide www.emarketer.com

  4. What is a B2B Exchange? • An e-marketplace where buyers and sellers exchange goods and services • Purchase mechanisms – one of the following: * Auction * Reverse Auction * Aggregate Auction * Catalogs * RFQ/RFP * Matching buyers & Sellers * Value-Added Services • Examples of services: * Portal * Workflow Management * Application Rental • B2B exchanges produce revenue via membership and subscription fees, transaction fees or some combination http://www.workz.com/cgi-bin/gt/tpl_page.html,template=1&content=1410&nav1=1&

  5. B2B Exchange • A B2B exchange is a cooperative among businesses where each corporation shares resources of critical commodities Critical commodities provide incentive to: • collaborate • reduce costs • share gains

  6. B2B Exchange • Potential competitors reduce costs through shared industry ventures (critical commodities) • Supply Chain Management: • Web based trade exchange for procurement • Component suppliers bid via exchange • Preferred supplier vs. open bidding? • Just in Time (JIT) inventory • Fixed networks vs. virtual networks Lacity, Mary, and Willcocks, Leslie, Global Information Technology Outsourcing: Search For Business Advantage, John

  7. B2B Exchange • Value-Added Benefits • Economies of scale - cut IT development and operating costs • Scalable common industry interface • Cut deployment costs • View real-time data • Increased visibility across supply chain • Security/data integrity (128 bit encryption) www.covisint.com/cgi-bin

  8. Three Categories Defined • Consortium • One or more business organizations pool leading vendors or buyers in a particular industry • Public Exchanges • Run by third party, open to all companies that meet standards • Private Marketplaces • Run by a single company and it’s key suppliers http://search.epnet.com/direct.asp?an=5271260&db=afh">The Dynamics of B2B E-Commerce.</

  9. Three Categories of B2B • Consortium • Global Food Exchange • Covisint • Public Exchanges • Commerce One • Private Exchanges • Wal-Mart and Dell • FuelQuest, Inc. http://www.workz.com/cgi-bin/gt/tpl_page.html,template=1&content=1410&nav1=1&

  10. Horizontal Exchange • Horizontal Portal Exchanges • Provides specializes services across several industries. • Example: SteelNet.com • Salesinfo • Markets • Supplies • Supplied to customers across multiple domains neonultra.com/b2b_b2c_b2g.htm

  11. Vertical Exchange • Vertical Portal Exchanges • Provides a set of services across a single industry • Example: VerticalNet.com • Technology • Communication • Environmental • Healthcare/Science • Biosearch.com: biotechnology/life science • Drugdiscoveryonline.com: pharmaceutical industry neonultra.com/b2b_b2c_b2g.htm

  12. Case Studies • Covisint • Automotive Industry • FuelQuest, Inc. • Petroleum Industry • FreeMarkets.com • Industrial Goods & Services

  13. Covisint Case Study Who Are They? Background Information What Do They Do?/Services Benefits of Their Services Case Study Conclusions www.covisint.com

  14. Covisint • The Global independent e-business environment for the automotive industry. • Mission: Provide services that connect trading partners and improve their interactions within their supply chain. www.covisint.com

  15. Who is Covisint? • Covisint is the technology services company whose business-to-business applications and communication services connect the global automotive industry. • They provide their customers with a common connection to suppliers, manufacturers and dealers in the automotive industry. www.covisint.com

  16. Background • Founders: • Covisint was formed by DaimlerChrysler, Ford, General Motors and Renault-Nissan. • PSA Peugeot Citroen has also joined the initiative. www.covisint.com

  17. Background • Began Providing Services • US – January 1st 2001 • Europe, Asia Pacific, and Latin American- July, 2001 • Locations • HQ – Southfield, MI • Amsterdam • Tokyo • Frankfurt • Paris • Brazil www.covisint.com

  18. Covisint’s Background • Industry Participants (Suppliers) www.covisint.com

  19. Covisint’s Background • Technology Partners • Technology Providers www.covisint.com

  20. Covisint’s Services • What do they do? • Works with manufactures, suppliers and industry trade groups worldwide to define and implement effective common processes for the industry. • Goals • Reduce costs • Increase efficiency • Enhance quality • Improve time to the market www.covisint.com

  21. Covisint’s Services • Procurement • Quality • Portal www.covisint.com

  22. Procurement Covisint Procurement dramatically reduces the amount of time needed to complete sourcing activities. • Auctions: • Becoming e-Enabled • Process Savings • Price Savings • Improved Decision Making • Benefits to both Buyers and Sellers • Return on Investment www.covisint.com

  23. Procurement • Covisint Catalogs • Reduced Purchasing Costs • Controlled Buying • Process Savings • Lower Overhead Costs www.covisint.com

  24. Covisint Quality • Covisint's Quality Solution Suite • provides industry standard web based tools to drive and accelerate product and process quality improvements through enhanced execution of quality planning and management across the supply chain • Problem Solver • To coordinate and manage problem solving between customers and suppliers www.covisint.com

  25. Covisint Quality Customer Benefits: • Decrease administrative cost and increase employee efficiency • reducing the paperwork expended in communicating problems to their suppliers • Improve product quality and decrease costs from faster problem communication and thereby faster resulting corrective actions. • Evaluate supplier performance and identify opportunities for continuous improvement. • Enables the process of implementing a secondary inspection process to ensure the delivery of quality parts. • Provides an easy means to record and recover the financial consequences of quality problems. www.covisint.com

  26. Covisint Quality Supplier Benefits • Provides an industry standard method for responding to customer problems. • Speeds resolution process through quicker and better understanding of the issues. • Continuous quality improvement due to improved knowledge of the patterns of issues. • Provides a customer accepted solution to a quality problem. • Provides the means to track the cost of bad quality. • Electronic ability to accept or challenge costs. www.covisint.com

  27. Covisint Portal • The Covisint Portal allows industry participants to access OEM applications, Supplier applications, and Covisint applications via one common framework. • Reduce IT and development costs • Leverage Internet and automotive industry standards • Cut Deployment costs • Increase visibility across supply chain • Best in-class security • Integrating applications www.covisint.com

  28. Covisint Portal • CSM: Global Market intelligence and forecasting services • HCI Group LTD: International Business Resource Journals services and products • Asia Talk, Euro Talk, Ameri Talk www.covisint.com

  29. Covisint Portal128 bit encryption • Security: Third party security certification by Trust Services. • Audits validity, security, integrity, and maintainability www.covisint.com

  30. Portal • My Workspace: customized views of information – mix and match information from multiple companies into comprehensive view. www.covisint.com

  31. GROWTH • Covisint: continues path of acceleration membership growth (253%) • 77,000 active users in over 15,000 companies www.covisint.com

  32. Covisint: Is it working? • Daimler Chrysler AG • “e –procurement” 10 billion euros 2001 • Online bidding (5/2001) 3.5 billion Euros • “e-shop” online catalog reduce process costs by 50% • “e- docs” shared document • “Fast car” automotive development www.covisint.com

  33. COVISINT • “The supplier portal supports our vision for an electronically-linked supply chain and will help DELPHI to support our customers requirements for responsiveness.” J.T. Bohgbey CEO DELPHI www.covisint.com

  34. Covisint • “Since launch we have responded to customer demands with flexible solutions that address their critical business needs and connect their supply chains. IT is the focus that has led to reductions in inefficiencies in our customer’s supply chains and enabled us to succeed where other exchanges have failed.” Bruce Swift President and CEO of Covisint www.covisint.com

  35. FuelQuest Case Study • Vision • Background • Services • Conclusion www.fuelquest.com

  36. FuelQuest Vision • Lead the charge to transform the businesses of petroleum suppliers, marketers, and large petroleum buyers into service-driven, technology-savvy, and Internet-enabled industry leaders intent on winning market share and growing profits.1 www.fuelquest.com

  37. FuelQuests’ Background • Independent • First transaction October 1998 • Industry leader in on-line petroleum sales • Provided first web-based business-management solution for petroleum marketers www.fuelquest.com

  38. FuelQuestServices • Provides and hosts web-based supply chain integration and collaboration technologies for the downstream petroleum industry. • Applications support procurement, management and sales of fuels and lubricants • Focus areas: price management, strategic sourcing, logistics optimization, remote inventory monitoring e-Procurement, and automated tax compliance www.fuelquest.com

  39. Capital Partners • CIBC Capital Partners • Merchant Banking Group • Venture Group • Private Equity Funds Group • Strategic Investments • EnerTech Capital • Lehman Brothers Venture Capital Group • TechQuest Capital Partners, LLC www.fuelquest.com

  40. Clients • Over 900 Clients • Large Commercial Users & Retailers www.fuelquest.com

  41. Suppliers and Refiners www.fuelquest.com

  42. Distributors & Marketers Customer base: Over 650 small to medium size businesses www.fuelquest.com

  43. Alliances • AIMS • Accenture • DM2 Software, Inc. • Sun Microsystems Technology • Microsoft • Cisco • IBM • Oracle www.fuelquest.com

  44. Alliances • Accenture • FuelAccess • b2b Solutions Marketing Industry • Meridian Associates, Inc. • FTA • Petroleum Marketers Association (PMAA) www.fuelquest.com

  45. FuelQuest Solutions • Supply Chain Management • eCommerce and Portals • Tax Automation • Consulting Services www.fuelquest.com

  46. FuelQuest Solutions • Supply Chain Management • Links customers, suppliers, terminals, warehouses, distributors, carriers, and trading partners in one virtual enterprise. • Replaces manual or linear SCM models • Circular model offers greater interaction, responsiveness, and cost savings. www.fuelquest.com

  47. FuelQuest Solutions • eCommerce and Portals • Effectively sell and service existing customers with online access to services and products • Reduce time to get business critical information to dealers and distributors from one to seven days • Decrease overall mail sent to dealers, jobbers, and distributors by at least 70% • Draw from existing applications for an inventory report, or provide a new capability hosted entirely by the Portal www.fuelquest.com

  48. Supply Chain Process www.fuelquest.com

  49. FuelQuest Solutions • Tax Automation • ZyTax providers Excise Tax compliance technologies and consulting services • Reliable, scalable solutions tailored for any size business. • Automates invoice calculations and compliance reporting to local, state, and federal authorities. • Automates motor fuel excise tax calculation and reporting. www.fuelquest.com

  50. FuelQuest Solutions • Consulting Services • Professional Services • Integration Service   • Application Development  www.fuelquest.com

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