More Dig into B2B Gold Mine

BOSTON (03/09/2000) - Marybeth Dee stumbled upon a business-to-business gold mine when she realized that North American vendors weren't getting the results they wanted when they turned to liquidators to sell excess inventory globally.

Instead, the liquidators were selling the products right back into North America.

Similarly, she realized that Asian manufacturers had no way to sell excess inventory outside of their region because they didn't have access to services that would help them do that. So, Dee came up with a strategy to link the two regions, and today launched Rebound International, an online excess inventory exchange company. Dee is president and co-founder of Rebound, based in San Francisco.

"We're talking about a US$350 billion worldwide industry," Dee said of the excess inventory market. "With the advent of the Internet, I saw a huge opportunity for manufacturers and retailers to remarket excess products outside their distribution channels."

In a recent research report, Gartner Group Inc. found that the business-to-business (B2B) market was worth $145 billion last year, and will generate $7.29 trillion in sales transactions globally in 2004.

Rebound is but one of the three B2B announcements today. B2BScene.com, a division of Open Text Corp., also today announced it is working with Base4 to form a first collaborative e-marketplace specifically for the biotech industry.

Also, Ford Motor Co. today announced a partnership with ZoneTrader.com to dispose of a wide variety of its surplus capital equipment. Under the agreement, ZoneTrader.com will take such equipment off the hands of Ford, and auction it over the Web. Surplus capital equipment includes items used in manufacturing and office furniture. Ford last month also said it is working with General Motors Corp. and DaimlerChrysler on a B2B online trading exchange for the auto industry. [See "GM, Ford, DaimlerChrysler Team on B2B Exchange, Feb. 25. ]In recent weeks, IBM Corp. announced it is joining with i2 Technologies Inc. and Ariba Inc. on a B2B alliance, while IMarket Inc. said it would use the Jpact ListServer from India-based Aztec Software and Technology Services Ltd. for its new Zapdata.com B2B unit. Likewise, AltaVista announced a new B2B e-commerce unit, AltaVista Business Solutions, and Reuters Ltd. and Equant NV said they are forming a joint venture that will offer, among other things, B2B e-commerce services. Microsoft Corp. and VerticalNet Inc. also have entered a joint B2B venture aimed at small and medium-sized companies.

The flurry of announcements, including those today, are good indications of the benefits of B2B in allowing companies to easily access a wider range of buyers and sellers online, according to Tom Harwick, research director of supply-chain management at Giga Information Group Inc., in Cambridge, Massachusetts.

"B2B e-commerce offers a lot of potential benefits," Harwick said.

One obvious advantage is that B2B e-commerce allows companies to easily access a wider range of buyers and sellers online. Companies also find collaborative opportunities in an electronic marketplace, according to Harwick. The benefits also include cost reductions in the supply chain and, an increase in the speed at which material flows though the supply chain.

Cost cutting is a stated objective of one B2B venture announced earlier this month. B2B Travel, an exchange formed by Ariba Inc. and Sabre Holdings Corp., allows airlines, travel agencies and transportation companies to cut costs by comparing prices and buying in quantity. The exchange estimates it will save companies 10 percent to 15 percent in costs by allowing them to participate in a single procurement Web portal site to buy and sell goods and services. [See "IEC: Ariba, Sabre Form B2B Travel, Transport Exchange," March 2.]Besides cost savings passed along to companies that buy through B2B sites, the vendors themselves save. Rebound, for instance, said that its 4 percent to 8 percent cut on each deal, depending on the transaction size, is significantly less costly than assigning excess stocks to liquidators. The average Rebound transaction is $50,000 with some $100 million in products already posted online today for the official launch.

Rebound, in San Francisco, can be reached at +1-415-202-7888 or http://www.rebound.com/.

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