Catch the B2B bug

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Catch the B2B bug

Many suppliers to the travel industry held back when the rest of the sector rushed to embrace e-business. But now one supplier, Design Go, has set up an online B2B marketplace for travel products and accessories.

We all know by heart the case for grabbing early-adopter advantage in the field of corporate IT; but sometimes there's a lot to be said for a little initial reticence.

Just ask Glenn Rogers, operations director of travel industry supplier Design Go, which sells travel accessories such as inflatable pillows and luggage to companies in more than 30 countries. He oversees IT and strategic development of Design Go and says that when the company first looked into the benefits that new technology and e-business could bring it failed to find a compelling argument.

"We couldn't see the value in just putting a catalogue of goods online," Rogers says. "It would've been great five years ago to have a fully functional Web site but to what end?"

The idea went on the backburner until nearly two years ago when the company came across a product from Dragnet, a supplier of e-business software and systems to the small- and medium-sized enterprise (SME) market.

"When we saw what it could do it piqued our interest and we realised it was worth investing in," says Rogers, and the idea of an online business-to-business (B2B) marketplace for travel accessories was born.

Having taken this long, Design Go was not going to lose its head and rush into an e-business foray. It presented Dragnet with a dataflow description of what it wanted and "had a plan down from day one". The system had to be tailored to its needs, it had to be future-proof.

The Dragnet product was originally geared towards the business-to-consumer market. So Design Go worked with the company to develop bespoke functionality and tune it to its B2B requirements. "We knew what our customers wanted," says Rogers.

He says the Web site is designed from a user's perspective. A multi-locational ordering system was built in to allow clients to place orders for each of their outlets on a single order form, although the orders arrive at Design Go individually. The company also wanted to give store managers more autonomy in placing orders.

It was decided that managers would be allowed to order from the variety of goods on display, using a password. However, the password parameters are pre-set by the client company's senior buyer, thus reducing maverick spend, says Rogers.

Buyers can order according to quantity or in pallets, however, the system automatically rounds the order up or down to the nearest pallet size. "The difference at our end in terms of processing that order is huge," says Rogers. "It's a big win."

Not only does it save the company from the physical process of going through picking bins to assemble orders, it is more efficient and cheaper to send out full pallets than partial ones.

Another function is the two-tier ordering process. New customers can see pictures of the 200 products on offer and access information but for more established customers who know what they want there is a "fast track" version.

Rogers says there was little or no competition to the Dragnet option. "They understood what we wanted to achieve and gave us confidence that it could be achieved," he adds. "And it worked very well."

Dragnet also made sure that the graphical front-end designed by Fusion Advertising and Design could be embedded into the product.

A prototype was up and running in the first week of February 2000, in time to be showcased at the Birmingham International Spring Fair - a major event in the industry's calendar - and Rogers says the response from small, medium and large retailers was very positive.

Heartened by this response, the company moved to get its international distributors using the system. As customer information was already held in the Pegasus Opera accounting system, existing customers could set up on the system almost instantaneously. And the number of glitches experienced by the distributors was minimal, because of the amount of integrity testing done beforehand by Rogers' team, who had "battered it to death" before it went live.

Not all of the company's distributors went live straightaway and some smaller companies are still not using it, preferring the more familiar world of phones and faxes. Rogers points out that the industry is rather traditional and conservative and says the take-up was relative to their "degree of comfort with technology".

But Rogers claims that those firms that did use it found it "extremely beneficial". As an added incentive to use the system, customers ordering over the Web receive packing priority.

About one month later the company started publicising the system to all its customers. However, on top of the reluctance of some of the smaller customers, it found that some of the larger customers already had e-commerce systems and their back-office systems would not integrate with it. So the company decided to target independent retailers - the "one man bands". Then came the smaller SMEs.

Rogers believes that in the future much of the integration and interoperability problems will be resolved, allowing it to get the remainder of its bigger customers on board.

Design Go has spent £35,000 on the system so far but Rogers says the system will not require any major changes for about five years. And it has already generated cost savings. For example, large pallet orders that previously could have taken around two weeks to prepare can now be prepared in a couple of days.

However, Rogers is keen to point out that saving money is not the only way to measure the success. "It's the learning curve for preparing ourselves for what will come next that is the real value of the project, not the money we'll save. The real benefits will probably come in the years ahead," explains Rogers.

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This was first published in November 2001

 

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