Westpac's B2Buy electronic exchange is shrugging aside the derailment of its e-commerce software supplier, Metiom.
The US company has laid off about one-quarter of its workforce and has reportedly filed for Chapter 11 protection from creditors. But Metiom Australasia, a year-old joint venture with Westpac into which the bank has sunk $45 million, is "very confident of continuing on", says its CEO, David Issa.
The investment was tied to Australian operations only and the company here is insulated against the troubles of its US parent, Issa claimed. "The US situation is going into bankruptcy but we have been working on building independence. We are very well capitalised and I am confident we are self-sufficient."
Metiom Australasia employs 34 people and a Westpac spokesman said the bank remains committed to its 49 per cent stake in the company. "We believe the business is performing well and we will continue to support Metiom Australasia."
The B2Buy online procurement market for Westpac business customers was the first exchange Metiom built here. It was launched on April 28 as a two-month pilot project, serving 300 buyers who are small-to-medium businesses banking with Westpac. The exchange currently has 16 suppliers and expects buyer membership to reach 500 by the end of June. "We will be looking to roll the exchange out across Westpac's entire SME customer base of 80,000 companies," Issa said.
Other exchange customers include the South Australian Government and BHP New Zealand.
B2Buy permits punch-outs to electronic catalogues hosted by tier-one suppliers such as Corporate Express. But the most of the small suppliers that don't have their own e-catalogues can use their Web browsers to place their products on the catalogue hosted by B2Buy. They receive electronic purchase orders, which can be converted into invoices for manual re-entry into their own systems.
The Westpac-affiliated exchange will perform payment authorisation on an order and send a remittance advice confirming that funds are available to fulfil the order.
For electronic exchanges in general, the missing link to date has been their dependency on credit card-based payments, said Issa. The next stage for B2Buy will be implementation of the preferred model for most businesses, a current account payments system, which lets them pay from their bank accounts. Among other things, that allows more flexible terms of trade to be negotiated with different suppliers, Issa noted.
The US parent company, formerly known as Intellisys, has a client list which includes JP Morgan, First Union National Bank and Intuit. It joins a growing list of e-marketplace software suppliers struggling to keep their balance in a turbulent market.
- The Australian Industry Standard.