Understanding that e-business is simply a way of doing business via the Internet rather than through old telephonic and manual, paper-based systems, is the easiest part of getting involved in e-business. Lizette McIntosh, supplier activation manager at MarketSite Africa, takes a look at the issues facing suppliers who want to explore the potential of online trade.
As the days go by and suppliers are being pressurised into participating in e-business ventures, the concept itself, to say the least, is usually viewed with trepidation and resistance. But the most complicated part of e-business lies in how to apply e-business to your organisation for the maximum benefit, and figuring out how to select the best solution that will help your company grow its sales, improve customer relationships and extend your reach into new markets. Suppliers are faced with a number of choices, but often these options are not clear when the choices for participating in the online trading solutions come up.
Total strategy
Suppliers need to understand that e-business is more than just trading electronically. Participating in e-business impacts on the company's entire business strategy - from how you deal with an e-mail from a customer, to back-office integration. It can affect many parts of your business - with many benefits if your e-business engagement is carefully planned and implemented. There are three essential steps in embracing e-business.
First of all, the most basic of Internet strategies, and a very well known one to most businesses today, is the use of e-mail to communicate with customers and partners, to receive and accept orders. The advent of e-mail has brought about a new way of communicating both internally and externally. It offers efficiency in terms of queries, memos, sending quotations and specifications, and simply keeping in touch. It brings a supplier far closer to the customer. A well-constructed e-mail with good content can serve as an additional call to the customer to keep him informed and up to date with any developments.
Create opportunities
Beyond e-mail comes the use of the Internet itself. While the Internet is sometimes viewed as a burden and an additional expense to a company, it is key in creating an opportunity for a company to provide its customers with an additional source of information about its products and services.
This could include, for example, the design and hosting of a Web site with an Internet service provider which would also require constant monitoring and modification to remain current and effective. Often this is viewed as a nuisance factor by companies and the idea is abandoned. Sometimes the strategy is not effective in terms of delivering good results, hence companies are sometimes reticent to follow this route.
However, like any other part of business, your success has to do with sound planning and marketing. The Internet needs to be viewed as an additional sales or information channel, applied in the achievement of a specific objective.
From static to dynamic
Finally, once a company has understood the benefits of, and made a commitment to, developing its e-business strategy, then dynamic e-business is the next logical step.
E-business has to do with transforming your business so that you can begin interactive trading online. This means that you will be able to receive purchase orders electronically, that customers can choose your products online and that they can trade at any time of the day, night or any day of the week.
Here the supplier has some choices.
Existing Web site
The supplier may already have a Web site. However, in many cases the product listing does not allow you to order directly from the catalogue. This is referred to as a static catalogue. It could contain some specifications about the products and services, and may contain list prices. All of this is purely informational and serves no other purpose other than to inform the buyer of the products you have available.
The supplier may have some buyers who are using e-procurement software of their own. They may wish to place orders from the supplier via their procurement software. To be able to do this, the supplier's product list needs to be transformed into a format which would enable a buyer to lift the information from the supplier's Web site, and draw it into the order form on his own system. This is known as a transactive catalogue.
This method of accessing a supplier's catalogue is often referred to as 'roundtrip' or 'punch-out' -- where the information is lifted from their Web site and moved into the procurement software on the buyers side, subject within this system to rules and workflow processes.
The buyer will create an order in their own system, which will be faxed, telephoned in or e-mailed to the supplier.
A supplier's Web site needs to be designed to allow such transactions. This requires development work on the Web site and the product catalogue has to be formatted in a specific way.
In this particular case, the supplier may host the Web site with his Internet service provider and will contract the services of a Web designer to maintain and update his Web site on an ongoing basis.
Next week: McIntosh will look at portal buying. She can be contacted on: Lizette.Mcintosh@marketsiteafrica.com.
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