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January 15, 2001

Exchanges Team To Link B-To-B E-Marketplaces

Partnership will let retailers connect directly with consumer Packaged-goods companies

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atch out Wal-Mart: Competing retailers soon may match the fabled supply-chain leader in its ability to connect directly with consumer packaged-goods companies. GlobalNetXchange, the giant retail marketplace founded by Sears, Roebuck, Carrefour, and Oracle, and Transora, the consumer packaged-goods exchange formed by 54 companies, including Coca-Cola and General Mills, have teamed to let retailers send purchase orders directly to manufacturers, exchange to exchange.

The joint interoperability venture, dubbed MegaHub, will be open to other marketplaces. It's already signed up its first customer, CPGMarket .com, primarily a European consumer packaged-goods exchange founded by SAPMarkets, Nestlé, Pernod Ricard Group, and 23 other investors.

The full-service integration hub will handle standards-based XML data exchange and integration to users' back-office systems. "Our industry has several major exchanges, and there was a fair amount of anxiety among manufacturers and retailers about whether exchanges were going to spend time warring," says Transora CEO Judy Sprieser. "Transora and GlobalNetXchange decided to build the MegaHub to make our services complementary."

Judy Sprieser Photo of Sprieser by Blair Jensen Retailers will have real-time visibility into manufacturers' inventory and delivery capabilities, and will be able to place and track orders online, says Gerry Palmer, executive VP and chief technical officer for GlobalNetXchange. The exchange also plans to let retailers integrate point-of-sale cash-register information to manufacturers' order-management systems, so that manufacturers can automatically replenish retailers' inventory. Ralston Purina Co. VP and futurist Betsy Cohen says the hub will make it possible for the company to directly manage the inventories of a much larger number of its customers.

Transora, which went live late last year, said recently that it will integrate with Novopoint.com, an exchange for raw-materials suppliers and manufacturers, and Foodtrader.com, an exchange for grocery-store product buyers and sellers. It also has revealed plans to interoperate with the WorldWide Retail Exchange, whose members include 31 leading retailers. A Transora spokesman says the MegaHub will likely be used to integrate these exchanges with Transora.