Trade'ex Aims High With Procurement

One way to judge the potential of a start-up is by the quality and size of its customers. That yardstick would make Trade'ex Electronic Commerce Systems Inc. a definite up-and-comer.

The company's customer roster includes such enterprise heavyweights as Raytheon Systems Co. and Nippon Telegraph and Telecom Corp. These companies have scores of disparate businesses and huge trading hubs and catalog sites aligned with specific vertical industries, such as MetalSite and PlasticsNet, that process hundreds of thousands of transactions between hundreds of suppliers and customers.

What Trade'ex offers is a many-to-many strategy where multiple suppliers can do business with multiple buyer organizations. That's why it aims at conglomerates that have hundreds of separate business units.

Trade'ex CEO Daniel Aegerter decided that his company's e-commerce strategy would aim at the high end to distinguish its e-commerce wares from such well-entrenched competitors as Ariba Technologies Inc. Ariba offers e-commerce products for individual enterprises so they can deal with suppliers.

To further carve his niche, Aegerter also developed three versions of the Trade'ex procurement system-one for the vertical trading hubs, another for large enterprises and a third for the distributor channel segment. It also links suppliers with distributors.

"We didn't want to be a Web front end to an enterprise planning system. Instead, ours is an interenterprise offering that can expand within a firewall or focus on an external marketplace and automate end-to-end commerce processes across multiple trading partners," Aegerter says.

Like many an entrepreneur, Aegerter turned an internal commerce solution-which he developed for the computer distributorship he worked for-into a robust online procurement system.

Trade'ex's procurement system is scalable server software that uses Oracle databases and an applications server to create a workflow and object-based business engine. Use of CORBA and JavaBeans technologies lets business logic be treated as objects and is easy to scale. An upcoming version provides support for 10,000 simultaneous users and beefs up security features for credit card payments.

CEO Aegerter says the three-tier architecture lets customers expand their businesses without redoing their catalogs and ordering systems.

With Trade'ex's system, "we were able to create a secure site that could sell more than 100,000 tons of steel to 500 customer organizations and make $30 million in revenue," says Patrick Stewart, CEO of MetalSite, a catalog and ordering system for steel buyers. "We plan to double that sale by the end of the year by scaling our catalog system," he says.

In addition to creating electronic catalogs and ordering systems, Trade'ex's procurement systems let customers, such as MetalSite, create online auction services that solicit bids from various suppliers for particular products.

MetalSite customers will be able to track and see the status of their orders later this year. The trading hub also will accept claims, process payment and provide customers shipping information about their orders.

With endorsements like this, Trade'ex is already measuring up.