Marketplaces are created when sellers and buyers come together to do business. That is a simple economic concept, but one that also tends to get obfuscated from time to time.
The confusion rears its ugly head when economists and technologists get together and start throwing their heady jargon around.
Let's see ... there is GDP, EPS, CPFR and, of course, ROI.
But, the fact of the matter remains simple. An economy does well when buyers and sellers get together and do business early and often.
By now, it is more than obvious that the general buying public just isn't ready to adopt the practice of buying goods on the Internet with enough fervor to keep the once-dizzying-and-now-dwindling number of digital sellers in business.
The current economic contraction was directly, if not solely, caused by the abysmal failure of B2C.
While most of us hope for a recovery soon, others pray the other shoe doesn't fall.
For technologists, "the other shoe" is B2B.
Bob Tedeschi, who writes the weekly "E-Commerce Report" for the New York Times, recently reported that Forrester Research, an Internet consulting firm, predicted the universe of B2B e-marketplaces will shrink to 180 in the next two years, from more than 1,000 today.
Eight weeks ago, SN reported the supermarket industry probably wasn't going to be able to support three major B2B trading exchanges in the near future.
The source of that was none other than the exchanges' chief executive officers: Colin Dyer, WorldWide Retail Exchange, Alexandria, Va.; Judith Spreiser, Transora, Chicago; and Joseph Laughlin, GlobalNetXchange, San Francisco.
Gerald L. Storch, vice chairman, Target Corp., Minneapolis, keynoted the Retail Systems 2001 show in Chicago delivering the same message.
Since that time, not much has been said.
I asked the CEOs of the three exchanges to talk to SN about this. Only Laughlin took me up on it. (See story on Page 17.)
"This is just a difficult topic for anyone to make any public comments on right now," Laughlin said.
"We [GNX] will be here for a long, long time," Laughlin said.
"GNX is very conservative," Laughlin explained. "Our ROI is fabulous. We spent money very frugally while going after the low hanging fruit.
"We have very highly committed market leading retailers [as equity partners]," he added.
The equity partners are: Kroger, Carrefour, Metro AG, J. Sainsbury, Coles Myer, Pinault-Printemps-Redoute, Sears, Oracle and Pricewaterhouse Coopers.
Then he mentioned that GNX was about to broaden its scope -- a move forecasters now say must occur if B2B exchanges are to survive.
He said GNX, an exchange launched by retailers, was starting a Supplier Advisory Board (see story on Page 17) in an effort to get more involvement and input from manufacturers.
Laughlin said GNX also has ambitious plans to proceed with CPFR pilots for each of its retailing equity partners. He anticipates those pilots will all go live this year. To date, GNX has enjoyed most of its success in the auction arena.
