E-Market Goes South of the Border

FRAMINGHAM (05/03/2000) - The business-to-business e-commerce revolution officially traveled south of the border yesterday as Ariba Inc. in Mountain View, California announced the completion of a live electronic marketplace centered in Mexico.

Built in conjunction with Miami's Asista.com, Ariba's technology will enable Latin American companies to engage in the same type of direct business-to-business transactions that are becoming common in the U.S. The first two companies that have signed up to use the new portal are W. W.

Grainger Inc., a leading seller of building maintenance and repair supplies based in Lake Forest, Illinois, and Key Quimica, a Mexican business that sells safety supplies.

John Schweig, Grainger's vice president in charge of business development and international operations, said his company's business share in Mexico is still relatively small - less than $100 million of Grainger's $4.5 billion in 1999 sales. Nevertheless, it has seen triple-digit growth in Mexico in each of the past three years.

"It's early. It's very, very early," Schweig said. "The e-commerce market is still in its prenatal stages here, but the pickup rate should be nothing short of incredible, and we want to be one of the leaders in that."

Grainger plans to offer 60,000 different products through the Ariba/Asista portal to other businesses, allowing building managers to purchase everything from ventilation equipment to hand tools to cleaning supplies.

"Basically, we've got everything it takes to keep a plant up and running, and they need that here just as much as they do in the U.S.," Schweig said.

Grainger has been involved with Ariba in many of its U.S. platforms, and Schweig said it has been his company's objective to create an online presence to drum up new business-to-business revenue. He added that the company already has made Latin American inroads via its own Web site.

"It's a great way for us to dip our foot in the water," Schweig said. "If all goes well, we'll be expanding our operations down here."

Grainger opened a Monterrey, Mexico, supply center in 1996 that now employs 100 sales representatives.

In a recent report, Forrester Research Inc. in Cambridge, Massachusetts estimated that Mexico will engage in $3.2 billion of e-commerce this year, with that number ballooning to $107 billion in 2004. E-commerce revenue for the rest of Latin America was predicted to reach $81.8 billion in 2004.

"Our industry-leading B2B Commerce Platform teamed with Asista's business model, knowledge and access to this influential regional market is a winning combination for bringing business buyers and suppliers throughout Latin America together to reap the substantial advantages of online commerce," Ariba President and Chief Operating Officer Larry Mueller said in a statement.

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