Commerce One, last year`s top-performing US IPO, has entered the South African market. Its entrance as a player in the local e-commerce space is underpinned by the announcement of its first two customers: Sasol and Affinity Logic, the IT joint venture between Wooltru and Datatec.
Sasol and Commerce One SA Distributor Operations have signed a Memorandum of Understanding for Sasol to purchase the Commerce One BuySite application, an e-procurement system. The system will link Sasol`s procurement system to an international portal of potential business-to-business (B2B) relationships. The second phase of the project will see Sasol market its products on Commerce One`s Global Trading Web, a portal system that hosts $1.3 trillion of potential trading.
Sasol has also purchased an equity stake in the company that will be created to operate the Commerce One MarketSite in SA, Commerce One`s B2B Web trading portal. "Sasol realises the enormous potential of electronic commerce in the petrochemical industry," says Pieter Cox, MD and CEO Sasol. "In the past few months we have been exploring ways to harness this potential."
With one-third of the company`s sales now coming from offshore buyers, Sasol hopes that the Global Trading Web will help it market its products over the Internet. It also hopes to streamline its ordering processing of its suppliers and help bring them on board Commerce One, opening the doors to online trading for them too.
Although Simon Ratcliffe, CEO Commerce One SA, skirted the issue of pricing, saying that each client was dealt with separately, rumour puts the price to Sasol at around R15 million. It will be up to Sasol to bring its local partners on board, although it is unclear what the pricing structure will be for its partners at this point. It plans to have an operational e-procurement service by the end of second quarter 2000.
The two flagship products that bring both buyers and sellers to the Commerce One system are BuySite 6.0 and MarketSite Portal 3.0. MarketSite provides the framework for a B2B portal solution that automates the process of buying and selling goods and services. "The product offers supplier content, pricing and all the other product information you require," says Commerce One Senior VP Carl Falk. "It also provides various business services, such as auction capabilities." Auction Services 2.0, he says, offers bi-directional auction facilities.
BuySite offers the desktop-based e-procurement system, bringing customers to Commerce One`s network of buyers, and significantly reducing cost of procurement to customers, according to Falk.
Falk says that the need for local partnerships to drive the Commerce One initiative is due to language and culture differences, time differences, and above all the need for relationships with clients.
The e-commerce solution vendor also touched on social responsibility, and says it is investigating the possibility of terminals in post offices to bring the public and the smaller enterprise to the party. The vendor also took the opportunity of the launch to present R1 million to the Mozambique High Commission for flood relief, and challenged other corporations to match the donation. It hopes to further help Mozambique and SA`s previously disadvantaged by bringing their products and services to the global market through Commerce One.
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