Digital marketplace forming for petroleum industry
By Industrial Distribution Staff -- Industrial Distribution, 11/1/1999
ATLANTA--Two e-commerce heavyweights expect to form an open digital market for suppliers to an estimated $300 billion petroleum industry.Harbinger Corp. and Sun-Netscape Alliance, providers of e-commerce applications and infrastructure software solutions, announced plans to create a portal that connects buyers and distributors. The marketplace for petroleum goods and services will feature a multi-vendor catalog and e-commerce transaction services.
The idea is to give the industry's leading energy producers access to a large number of suppliers, enable them to maintain control over those relationships and form tighter integration with enterprise information systems, said Steve Savignano, a senior vice president at Sun-Netscape Alliance.
"We can help give electronic commerce in the petroleum industry a jump start," said C. Tycho Howle, Harbinger's chairman and CEO. "This new portal will provide our petroleum customers and prospects unprecedented facilities for buying and selling products and services electronically, including auctions, surplus sales and industry news."
About one-third of the petroleum industry's $1 trillion annual spending is on MRO goods and other indirect materials.
Mac Hadden, president of Standard Supply & Hardware Co. in New Orleans, La., whose customers include the petroleum industry, agreed there is an ample market "for what this site is intended to accomplish." He suggested distributors should move quickly to become a part of such electronic ventures.
"The key to all of these opportunities is to have a Web-capable content database of materials that the prospective customers would want to buy," said Hadden. "That is an impediment for most all distributors at this point in time -- but many of us are working on this right now.
"Who knows what the future holds, but it appears that the best strategy is to play in several different arenas, at an affordable cost, to see what ends up panning out."
Tom Banta, vice president and general manager of Harbinger's catalog solutions division, said a key goal is providing connections to other portals, or vertical industrial markets. That would make it easier for a company that distributes processing equipment to the food and beverage industry to also market the equipment to petroleum suppliers, for example.
"We think the industry has a need for a central place to go to for information and commerce," said Banta. "We believe we will bring value-added services and applications in the portal. We recognize other people will select other technologies and we'll connect some people to other portals we don't have."
At press time, Banta said it was too early to discuss potential relationships with other online markets. However, he said Harbinger and Sun-Netscape Alliance will actively seek out participation from industrial distributors like W.W. Grainger, Inc., WESCO International, Inc., Graybar Electric Co. and Motion Industries, Inc.
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