Netway targets supply chains with electronic trading system

Telecom subsidiary Netway is aiming its new electronic trading service, CommX, at both the "hubs" and "spokes" of New Zealand's supply chains. The service will enable companies to trade electronically with their partners through the CommX Web site using browser, fax or existing EDI (electronic data interchange) technology.

Telecom subsidiary Netway is aiming its new electronic trading service, CommX, at both the “hubs” and “spokes” of New Zealand’s supply chains.

The service will enable companies to trade electronically with their partners through the CommX Web site using browser, fax or existing EDI (electronic data interchange) technology.

Telecom’s business manager for electronic trading, Laura Vlad, says systems like CommX, which uses Netway software connected directly to the company’s accounting system to convert orders into electronic documents, offer the cheaper transaction costs and speed of EDI systems but with far lower set-up costs and complexity. She presented the service fee of $40 a month plus “usage” charges as evidence the system should appeal to “SMEs” — small to medium-sized enterprises.

Despite Netway’s close targeting of the top six hundred corporate firms in the country for its services, the company is keen to attract SMEs to the party because unlike bigger countries such as the US, New Zealand is dominated by SMEs and EDI is better suited to larger trading organisations, Vlad says.

Vlad notes the oft-quoted figure of manual transactions costing anywhere between $15 and $45 each, whereas electronic transactions can be completed for less than $5. Vlad says e-commerce usually cuts down on paperwork, post and fax costs, human error, manpower and inventory management.

The service’s Web site — www.commx.net.nz — stresses the “hub and spoke” approach to inter-enterprise electronic trading. It suggests that automatic trading, where documents are directly generated from a company’s accounting system, is likely to be better suited to the “hub”, or multi-supplier enterprise, whereas manual trading is better suited to “spoke” supplier organisations with relatively low transaction volumes. Hamilton-based power fencing company was a beta site for the service.

The CommX system is part of Netway’s X400 network, which Vlad says means messages are authenticated and delivery guaranteed. Its fax capability cannot accept inward messages.

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