What's your Web strategy?
This New Year, make it a priority to define your Web initiative
By John R. Johnson -- Industrial Distribution, 1/1/2000
Okay, so you're scared to death by this e-commerce thing. Who wouldn't be. The ramifications of the Internet movement are staggering. Talk is of online transactions totaling trillions in the not too distant future. Major customers are approaching distributors every day, asking when they will be e-commerce enabled.Ford and General Motors have announced that they will do all procurement over the Web within a year.
What's a distributor to do? Well, there are plenty of options out there. A rash of dot-com initiatives aimed at the MRO industry have been unveiled recently. Two of the most recent are Eventory.com, a site that will give its member distributors their own online storefronts, and supplyFORCE.com, a venture announced by Affiliated Distributors. In just one month since announcing its e-commerce initiative, supplyFORCE.com signed up 240 distributors.
Of course, there are too many e-commerce ventures to mention, but for a more complete list, check out our special section on e-commerce which begins on page 53. But make no mistake about it: The Internet age is upon us in distribution, and it's going to mature faster than any other development we've seen to date.
Already, W.W. Grainger says that its online initiatives are bringing in millions -- an expected $100 million in 1999, to be exact. That number alone would place Grainger's online sales at No. 58 in our annual Top 100.
Still not convinced that online sales have a future in distribution? Well, note that a recent report in Purchasing magazine, a sister publication of ID, states that 81 percent of purchasing professionals -- your customers -- use the Internet in their job. That's up from 73 percent in 1998, and represents an incredible increase from 1997, when just 45 percent of buyers utilized the Web.
And guess what? The study also asks buyers what type of goods they will use the Internet to purchase. Out of eight categories, MRO and office supplies wins hands down, with 55 percent saying they will use the Web to locate data on such products, and 35 percent claiming they will buy MRO products online. The next closest segment is computers and peripherals. Buyers plan to purchase roughly 21 percent of those goods online.
So what's your e-commerce initiative? Go it alone? Join a dot-com alliance? Do nothing? Since it's a new year, make it a point to at least form an e-commerce strategy within the first six months of 2000.
Then, try to act on it by the end of the year. Anyone who waits longer will find themselves heavily behind the e-commerce eight ball. You're going to hear lots of people talking about their Millennium resolutions this year. Chances are, lots of them will be broken by the time you read this column. However, if there's one resolution absolutely, positively worth keeping, it's determining your e-commerce strategy.
EDITOR'S NOTE -- Next month, Ken Brack will begin writing our monthly On the Web column. Ken was selected from a highly qualified group of candidates to replace Sara Procknow last month. Many of you have gotten to know Ken during the past two years when he served as Associate Editor. We're excited that Ken will lead our Web site initiatives in the future. Please email any column ideas or thoughts on our Web site, to Ken at kbrack@cahners.com
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