InformationWeek
Defining The Business Value Of Technology
February 1, 1999
Net Catalog SalesSciQuest to sell laboratory supplies, chemicals on Web
By Clinton Wilder
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any vertical-market Web-based catalog companies are looking to turn their offerings into full-service E-commerce sites. Next month, SciQuest Inc. will add electronic purchasing to its online catalog for laboratory instruments, chemicals, and supplies."We think the time is right," says SciQuest president and CEO Scott Andrews. "We have suppliers calling us about posting their catalogs, instead of the other way around. And the buyers say they're ready."
SciQuest's site, launched in 1995, features product and contact information for 3,500 suppliers to U.S. scientific, medical, and industry research labs. The company expects 500 suppliers to offer online ordering on SciQuest by year's end. Buyers will place their orders on the Web site, but SciQuest will initially send them to the suppliers via electronic data interchange, E-mail, or fax. The company plans to help suppliers migrate to end-to-end Internet commerce transactions using IBM's Net.Commerce server software.
About 25,000 of the nation's 150,000 research labs use SciQuest for research and browsing. The site's largest customers include Johns Hopkins University, the University of North Carolina, and Roche Pharmaceuticals. The U.S. market for laboratory supplies and chemicals is about $10 billion per year.
SciQuest is an example of the "compete" model of online middleman, says Ravi Mhatre, a principal at Bessemer Venture Partners, a SciQuest investor. "It's a Web-based distributor in a large market with many suppliers, competing directly with physical-world distributors."
SciQuest competes with at least two other Web intermediaries, Chemdex Corp. and Anderson Unicom Group Inc.. SciQuest says it offers more products, but the measure of its success will be the transactions it generates.
"We thought about offering online buying a year ago," Andrews says. "But we wanted to wait for critical mass in the market."
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