Ariba takes rental route in NZ

E-marketplace software vendor Ariba is adding a hosted application service in an attempt to tap into the small and medium-sized enterprise market down under.

E-marketplace software vendor Ariba is adding a hosted application service in an attempt to tap into the small and medium-sized enterprise market down under.

On a visit to Auckland, Ariba Asia Pacific managing director Mukesh Aghi said the Nasdaq-listed company, which targets $US1 billion corporates in the US, has realised that the majority of organisations in New Zealand and Australia are less than $100 million SMEs and require different e-procurement and marketplace software models.

“Our strategy in Asia Pacific is quite different than the US,” Aghi says. “In smaller regions where [potential customers] revenue volumes are low, we will look at ASPs; the model will vary country to country and the proposal has to be price-sensitive to each market.”

Part and parcel of this was a growing recognition local companies wanted monthly payments rather than a high initial payment.

Ariba New Zealand is to offer its software through Unisys’ ASP service and through the Telecom-EDS-Microsoft alliance esolutions, country manager Mark Heard confirms. He says he is in early discussions with possible customers.

Australia and New Zealand head Allan Smith, recently appointed from Computer Associates, says the Australian office is working closely with the banking industry on SME initiatives. He is expected to announce the first Australian ASP to host its software within the next few weeks.

Aghi says working with ASP partners follows Ariba’s strategy of using implementation partners rather than consulting and servicing customers themselves – all of Ariba’s projects are completed with third parties. As well as channel partners, Ariba has joined with banks and all of the Big Five consulting firms.

Aghi, who is moving from his Singapore base to join the corporate head office team, plans to increase the size of the Asia Pacific Ariba team from 200 to 400 this year to cope with expected sales demand. Australia, which New Zealand reports to, has already grown to 30 from less than a dozen.

Aghi says business in the region grew 20% in the last financial year and is projected to pick up further.

In Japan Ariba customers include Sony, NEC, Soft Bank – also an investor - while in Australian Ariba clients include, NRMA, Orica, Origin Energy, Resources Trading and the Commonwealth Bank. In New Zealand Ariba works for Biolab’s OneZone marketplace and is used by Telecom.

Ariba Asia Pacific’s plan is to add more than 2000 suppliers outside Japan to its worldwide customer “network” this year and to add 10,000 in Japan.

Aghi says the acquisition of Agile, whose software facilitates online shared environments, will help accelerate the next stage of e-commerce: “collaboration commerce” or interactive supply chain management. He says this is when companies move on from wanting to be connected to just their suppliers and are connected to all their business partners to communicate in real time.

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More about AgileAribaCA TechnologiesCommonwealth Bank of AustraliaEDS AustraliaMicrosoftNECNRMA GroupOneZoneOrica AustraliaOriginSonyUnisys Australia

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