Tradehub aims e-commerce at SMEs

Australian Business On-Line (ABOL) is making sure its 4000 members will be able to take advantage of online trading using Tradehub.

Members of ABOL include large companies such as BHP and Boral, but most are small to medium enterprises (SMEs).

Australian Business On-Line started life as an industry association providing information online.

CEO John Murgatroyd saw the emergence of electronic commerce as an enormous opportunity to provide a service to members.

He said he saw his role as ensuring SMEs were not disenfranchised and that as e-commerce took off they had the opportunity to grasp the technology. To this end he formed the e-commerce operation called Tradehub, which will be officially launched at the end of this month.

"We may be the new kid on the block but we have the best sneakers," Murgatroyd said.

The e-commerce industry demands that organisations be flexible and adaptable, with speed to market being key. Tradehub provides its members with the infrastructure to optimise e-commerce technology.

Tradehub was developed using a simple model that connects customers and suppliers with intelligent messaging systems and automatic payment facilities. The model streamlines the supply chain by making ordering faster, reduces inventories and automates payments.

"When we were developing Tradehub we scoured the world for the best technology products.

"We are not in the business of developing technology.

"As well as the best technology, of equal importance were the companies that would partner us to develop the e-commerce business. ABOL formed strategic partnerships with Frontec -- a Nordic applications messaging company which provided the core component, namely the intelligent messaging system -- and IBM" Murgatroyd said.

"Tradehub, IBM and Frontec have put in a joint bid for a Victorian government tender to provide an e-commerce solution and we are on the short list of four [suppliers]."

Tradehub provides electronic catalogues -- which Murgatroyd stressed were far more sophisticated than a home page -- which makes business-to-business purchasing easier; includes an order/negotiation system; provides virtual logistics for shipping and a payment system.

ABOL is working with a number of banks to use electronic cheques and online debiting and crediting. However, it does not expect to finalise this facility by the end of the year as industry groups are still debating the protocols and standards.

"We will plug into whatever standards are accepted," Murgatroyd said.

"The glue for the Tradehub system is the Frontec intelligent messaging system. It provides immense capability and integration with legacy systems.

"All of the Tradehub components are Y2K-compliant.

"Business requirements drive the system. Given that we are looking after SMEs as well as large organisations, we have made every effort to keep entry barriers in terms of technology and costs as low as possible. To participate a company needs a browser.

"Enormous enthusiasm greeted this initiative when we took it to nine regional centres as there is a huge pent-up demand for e-commerce.

Tradehub is not an industrial strength e-commerce solution but meets the criteria for business-to-business strength." Murgatroyd said.

One of the catalysts for business to go online is that the NSW government and other state governments require their supplier community to be online. According to Murgatroyd, EDI (electronic data interchange) has proven to be too complicated and too costly.

Frontec's AMtrix application messaging system links Tradehub to businesses using the same technology to provide an end-to-end solution. "ABOL found Frontec after extensive research," Murgatroyd said. The AMtrix any-to-any messaging is key because it can convert any form of communication be it fax, e-mail, pager and send it to the seller in a format the seller can read. AMtrix also has in-built intelligence which allows it to apply business rules and be proactive by providing alerts if there are business problems. In addition, AMtrix plugs seamlessly into leading enterprise resource planning (ERP) systems, such as SAP and Oracle financials.

Nic Pollock, region manager, Frontec, said: "Quite a few large well-known organisations actually have very sophisticated Web sites that look and act like shop fronts for e-commerce; but there are no back office systems to back them up, which means users have to key the information into the system.

This is not cost-effective and is a sign of organisations jumping on to the e-commerce wagon without thinking it through.

Even though Tradehub has not officially been launched it already has a number of customers. The supplier will pay a flat fee for each fulfilled order. The final fee has not been decided yet but it will be in the order of $2 to $3. Tradehub will keep a transaction log and will bill customers, or they can pay online.

Murgatroyd said this was rather different from a traditional value-added network where you pay every time for an order, which can cost in the region of $100 to $150. With Tradehub users get increased efficiency and better supply chain management. The only other cost is putting together an electronic catalogue. If an organisation can't do it then ABOL will help.

"Tradehub's approach is incremental. Organisations can take what they want.

"We are not forcing people to change how they do business," Murgatroyd concluded.

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More about ABOLAustralian Business On-lineBHP BillitonBoralE-Commerce TechnologyFrontecIBM AustraliaNICNSW GovernmentOracleSAP AustraliaTradehub

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