Many retailers use the Internet as a medium to sell to consumers, and now they're using the Web to reach suppliers and distributors. Today Sears, Roebuck and Co. and French retailer Carrefour agreed to team up with Oracle to create an online marketplace for retailers and their trading partners.
In a similar move, software provider i2 Technologies Inc. revealed an online exchange for apparel, textile, and home furnishings manufactures, suppliers, and retailers with its first anchor tenant VF Corp., maker of Lee, Wrangler, Healthtex, and Jantzen clothing brands.
Sears and Carrefour say their network, called GlobalNetExchange, will make purchasing apparel, soft goods, hard goods, and groceries faster and more efficient than through electronic data interchange networks. Though they have yet to name any suppliers involved in the exchange, they plan to hold the first auction on it within several weeks. They plan to bring more retailers onto the exchange and add inventory management, order promising, and transportation scheduling capabilities. SoftgoodsMatrix.com, i2's site, will provide similar services and plans to start operations in April.
Oracle, which holds a minority interest in GlobalNetExchange, will provide the transaction and database software on which the exchange will run, as well as implementation and support services. This is the second business-to-business trading exchange in which Oracle has a stake. The company has a similar role in an automotive industry marketplace on the Web with Ford Motor Co., which merged last week with a competing exchange run by General Motors Corp. and Commerce One Inc. and now also includes DaimlerChrysler AG.
Observers believe the key to the success of exchanges in any industry is to attract enough of the right participants. The opportunity for fragmentation is greater in retail, where there are tens of thousands of suppliers, than in automotive, where there are relatively few top manufacturers and tier-one suppliers, says Bob Ferrari, an analyst at AMR Research. "Every day now we're hearing about more industry exchanges," he says. "There has to be some rationalization to get everyone to play."
[For more on online marketplaces, see: http://www.informationweek.com/775/marketplace.htm.]