Gashing in on electronic GOmmerce

By Mike Owens Director of Sales & Marketine WoodWare Systems Memphis, Tn.

nO YOU ever wonder what the l-ftechnology of the future will be like? How about these possible scenarios: o Contractors and builders use the Internet to place orders and check inventory availability with their building material dealer or distributor. o Dealers and retail lumber yards use full-line electronic catalogs provided by their distributors. These dealers can quote doors, windows, mouldings or any other products for their customers, then electronically place the order directly with the distributor. Price and product updates from the distributor can be automatically sent to the dealer's computer. o Building product manufacturers and distributors receive orders electronically from retail chains, then invoice these customers electronically. Electronic funds transfer provides a direct, bank-to-bank money transfer, further expediting the transaction.

All of the above examples of electronic commerce are either already in place or on the immediate horizon in the building materials industry. The expansion ofthis technology is forcing companies up and down the distribution chain to reevaluate their approach to doing business.

While electronic commerce is one of the most critical elements of business success at present, it will be even more so in the years ahead. Those not currently using electronic commerce should plan now to get on board.

Even if you are not yet using electronic commerce, there's still some good news for you: First, your options for using electronic commerce are better and easier to use now than in the past. Second, electronic commerce is an improved way to serve your customers better and to make it easier for your customers to do business with you.

Third, electronic commerce is an approach which promotes an even greater emphasis on the concept of partnering and business relationships, both with your customers and your suppliers. It is another way for you to add value to these relationships.

The Traditional Approach: EDlthrough a Value-Added Network

Up to this point, the most widely available applications of electronic commerce have been EDI approaches using Value-Added Networks. Many large retailers, especially the bigger chains (such as Lowe's, Home Depot, Builders Square) require their suppliers to use EDI for orders and invoices.

EDI is the computerized exchange of business documents. The ValueAdded Network serves as sort of an electronic post office, and handles much of the computer-to-computer transaction formatting and communications. Changes are coming, however, which may greatly affect this in the years ahead.

Now Playing: Direct Connections & Customized Electronic Catalogs

The traditional EDI approach using a Value-Added Network provides services that enable most any company to utilize electronic commerce. The more progressive companies in the building materials industry, however, are seeking a more direct approach.

They want direct electronic links to their suppliers and customers, without having to go through a network. These direct connections will enable manufacturers and distributors to provide product and pricing information as well as direct ordering capabilities for their customers.

One issue which has surged to the forefront is the requirement to combine all of the products sold by a distributor or dealer into a single electronic catalog. This enhances the partnership between the distributor or dealer and their customers since all their products (windows, doors, stairparts, moulding, etc.) can be easily quoted together and then electronically transmitted up the distribution channel to their supplier's ordering system.

WoodWare Systems, for example, recently introduced WoodWare Visions, a graphical Windows-based, customized electronic catalog for millwork. The new system allows for direct communications and quoting a full product line that a dealer, distributor or manufacturer cames.

Story at a Glance

Electronic commerce is here new technology tar extends standard EDl.

Partnerships Between Dealers, Distributors & Manulacturers

The key to the successful application of electronic commerce is providing a tool to make it easier to team up with your business partners in all directions on the distribution channel. As companies move more heavily into electronic commerce, the use of the Internet as a connectivity and business tool will also come into play more often. Using your Web page as a means for receiving sales orders and for quoting product and price information will be still another way for companies to utilize electronic commerce effectively.

Relationships will remain the foundation upon which electronic commerce is built. All the technology in the world cannot replace a handshake and business partnership, but it certainly can enhance them and provide a means to add value to the relationship.