E-Purchasing Ramps Up in NZ

AUCKLAND (01/25/2000) - E-procurement, whereby businesses buy goods and services over the Internet, is ramping up in New Zealand with several new products entering the market. Now that companies have put the Year 2000 compliance hurdle behind them, they are considering fresh projects such as e-procurement.

David Hollies, MIS manager with Benchmark Building Supplies, says now that Year 2000 compliance projects are out of the way he hopes Benchmark will have an e-procurement system sometime this year.

Hollies gives efficiency and reduction of paperwork as major reasons for going to e-procurement. Also, Benchmark's head office would be better able to monitor what is happening between suppliers and each of its 43 branches, he says.

Hollies believes many companies will try and develop their own e-procurement systems in-house but says he would rather take advantage of the expertise and development that has gone into a packaged e-procurement solution.

Last year Benchmark looked at OrderWare from Wang and Genie Systems but put its e-procurement plans on hold to coordinate with the company's Australian parent, Howard Smith, which has gone with SAP. Auckland-based Refrigeration Engineering is another company considering e-procurement for the future. Financial controller Don Ambrose also cites increased efficiency as a major benefit along with stopping the flow of paper around the business.

Meanwhile, a slew of vendors are rushing to service the market. Omega E-Commerce, a newly formed company has introduced Clarus eProcurement to the local market. The Wellington-based distributor is a sister company to Omega Financial Solutions, a supplier of accounting systems to large and small organizations.

Omega E-Commerce will focus mainly on business-to-business solutions by Atlanta-based Clarus, but will also supply products from other vendors where Clarus doesn't have an offering.

The e-procurement product will be distributed to Omega Financial Solutions' New Zealand customer base of more than 100 companies (including the Ministry of Commerce, Tauranga District Council and law firm Kensington Swan) as well as potential customers. Clarus eProcurement, which is aimed at large corporations, has an entry price of around NZ$150,000 (US$76,100) for 30 seats.

Last month Telecom and Australia's third-largest telco AAPT (which is 80 percent owned by Telecom) each signed licensing agreements with Californian software company Ariba to offer e-procurement services in both Australia and New Zealand.

Telecom Xtra and AAPT's business-to-business e-commerce provider, connect.com.au, will provide the access infrastructure for businesses. The telcos will also use the Ariba Network service and Ariba ORMX software to manage their own purchasing and trading. The Ariba.com Network site links buyers and sellers of operational equipment and services ranging from office supplies to travel.

EDS, an e-commerce partner of Telecom, is also to team up with Ariba to develop Web-based procurement sites in the U.S.. EDS is, along with Microsoft, Telecom's alliance partner in eSolutions, the business-focused online division that Telecom is due to unveil next month.

Now, EDS's U.S. subsidiary, CoNext, has announced it is joining with Ariba to co-develop Web-based business-to-business procurement sites for big corporate customers.

Meanwhile, local telecommunications company Clear Communications is interested in offering e-procurement services to customers.

Clear sees an automated procurement system as a possible ASP (application service provider) offering to complement its Payment Gateway service. Wayne Nicholas, Clear's strategic business development manager, says Clear is seeing an increasing requirement for automated procurement.

"Organizations are saying that the paper processes involved in working with suppliers are horrendous."

Late last year computer services company Wang began offering WangOrder, an online ordering product, to its clients and competitor Axon Computertime upgraded its online ordering system Quality Direct (which it credits with a product revenue increase of 43 percent last year) moving it to Microsoft's e- commerce.

Wang is also piloting a business services portal which offers online ordering, workflow software to assist clients purchase product, asset management applications. Although confined to ordering from companies within Bluestart Business Solutions, the aim is to eventually provide access to services and products from outside the group making it a broad-based New Zealand business products and services portal.

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More about AAPTAribaAxon SolutionsClarusClear CommunicationsComputer Services CompanyConnect.com.auEDS AustraliaEsolutionsGatewayGenie SystemsMicrosoftOmega FinancialOrderwareSAP AustraliaSWANWangXtra

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