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November 20, 2000

US Office Products Tries To Stay Ahead Of The Game

Illustration by Kerri Smith

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Pity the poor suppliers. Many have been blind-sided by their customers' E-procurement projects. They're besieged by requests for electronic-catalog information and support for commerce transactions in different formats for various clients and are finding that E-commerce capabilities have become as key a criterion as price in winning new business and retaining existing accounts. Yet even suppliers able to keep up may find themselves squeezed out as customers trim their vendor base to fewer preferred partners.

On the front lines is US Office Products Co., a $2.5 billion manufacturer and distributor of office supplies to business and industrial customers in the United States, Australia, Canada, New Zealand, and the United Kingdom. The company is working with 15 customers, including Hormel Foods Corp., and several online marketplaces to provide electronic product information and enable transaction connectivity.

The ability to support E-procurement processes has been a major factor in recent bids for new business, the company says. To that end, it has invested $2 million and six full-time staffers in the challenging effort. "No. 1 is the various platforms we must be able to engage with and the lack of standardization among them," says Chris Harvell, director of E-commerce sales and marketing in US Office Products' Washington headquarters. "It seems as though there's a new E-procurement platform every five minutes."

So far, the company has focused on three E-procurement packages--from Ariba, Commerce One, and Oracle--offering its catalog in each of their required formats. Now it's working on doing the same for competing applications from Metiom and Clarus. A generic version of the US Office Products catalog is also available through a few of the software vendors for companies to download and test. But US Office Products works with each customer individually to incorporate contract prices, product images, and a customized product selection that can range from 200 to 26,000 items.

The company has implemented software from WebMethods Inc. that lets it translate transaction data from its Unix back-office systems into the unique Extensible Markup Language formats used by various E-procurement vendors. It has deployed a catalog-management application from Saqqara Systems Inc. to aggregate and normalize product data. The company also has an in-house development project under way to build an E-commerce-enabled Web site. When that's complete, US Office Products will be able to route customers directly through its site to browse its catalog and initiate transactions from within their E-procurement systems.

While the company is confident it's ahead of many others in its support for E-procurement, US Office Products hasn't been immune to the trend's downside. It has lost regional business that accounted for 3% of its revenue, after several customers re-evaluated their supplier base as a result of online procurement initiatives and went with a different vendor. The company says it lost those accounts not because of its technical capabilities, but because the level of business it did with those accounts was limited to an office or a region and never reached a corporate level where strategic buying decisions are made.

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Illustration by Kerri Smith

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