E-marketplaces may be regaining popularity, but those operating today are different to those that failed a few years ago. From 3000 operating five years ago, there are only 20 e-marketplaces today, according to Quadrem Australia regional vice president Jay Layman.
Quadrem is a global e-marketplace for industrial maintenance, repair, and operations products for the mining and metal industry and last week announced a 100 percent increase in revenues and a doubling of the number of transactions over 2003.
In Australia, Layman said the company transacts $100 million a month in business and boasts clients like BHP Billiton and Rio Tinto.
He said e-marketplaces have changed by becoming a lot more focused.
"The ones that failed tried to do too much; we have focused on what we can get value from, and the ones that couldn’t provide value have fallen by the wayside," Layman said.
Layman cites three reasons driving companies to use e-marketplaces - complexity, cost and standards.
“If an organization wants to connect electronically, an e-marketplace can provide a lot of scale,” Layman said.
One user of the Quadrem e-marketplace is Camco Engineering, which joined after purchasing Abonnel Engineering.
Camco group manager of sales and marketing, Gordon Wasley, said the benefits are many.
“We’re proactive in electronic communications and also, many of our major customers use Quadrem so we felt we needed to embrace their ideas and methods,” Wasley said.
“We believe over time it can offer seamless communication with our major customers for all work completed.”
Wasley said the benefit to companies of e-marketplace participation is the speed of collaboration with potential customers.
However, Wasley admits there are some opportunities yet to be realised.
“We’re just new users of Quadrem and it hasn’t really kicked in yet, but it is moving along for us,” Wasley said.
As for Cumi Australia marketing manager Sushil Kumar, the reason for joining an e-marketplace was simple – to gain more customers.
“Quadrem was chosen as a different approach to accessing more customers. We were looking to get more customers without having to do more running around,” he said.
Kumar admits no customers have materialised in the past four months, but claims it is more a reflection on the current climate than e-marketplaces generally.