ThomasNet Takes Sourcing to the Masses
ThomasNet recently launched it's free Purchasing Tools, based on SourceOne's free WhyAbe platform. This platform allows buyers who still haven't adopted an e-Sourcing platform to test the waters with a basic RFx and Auction service.
The platform, which comes with a complete Buyer User Manual as well as a Supplier User Manual, allows buyers to create a private or private RFX, see their listings on a dashboard (where they can also identify reviewers and block blacklisted suppliers from bidding), and also take advantage of ThomasNet's engineering, web, and community tools. The RFxs are essentially RFQs where you solicit bids for well a basket of well-defined products and services, and the reverse auction formats are limited to supplier rank and lowest bid, but that's where most companies start on their e-Sourcing journey.
The auction tool allows you to specify whether or not you want duplicate bids, minimum decrements during bidding (as a number or percentage), and automatic extensions to prevent bid sniping. The product also supports multiple currencies, attachments, and product images as well as e-mails to invited suppliers. It's not on par with any of the paid Software-as-a-Service offerings, but as I've said before, it's cracking the sourcing mold and offering a free solution that companies new to sourcing and sourcing technology can use and experiment to find out what works for them, what doesn't, and what they need help on. It's a great way for a company to test the water as it provides a quick start to e-Sourcing with a price that can't be beat. Then, when an organization has identified it's needs, and, more importantly, identified what it can do well in house - and what it can not, it can always upgrade to a more extensive e-Sourcing platform and retain a PSP, like Source One, to help it with those categories that it doesn't have the experience, or the leverage, to get savings on.
So, let's give ThomasNet some applause for trying to spread the sourcing word and hope that this convinces more organizations still using e-mail and fax for RFQs to join the twenty-first century.
I plan to write about this as well, but here's my quick take:
- Way too little too late
Reminds me of the American Indians trading with the Brits for outdated muskets before fighting US soldiers with rifles ...
Thomas, unfortunately, should have acted 10+ years ago starting with buying out MFG.com, taking more aggressive stances on plays like Alibaba, etc.
Lost opportunity!
Wow, that's pretty harsh. Anyone can play the hindsight game, hindsight is always 20-20.
But maybe this comment can be read as yet another stab at Gartner's Debbie Wilson, for annointing WhyAbe as a Cool Vendor.
Not a knock on Why Abe (though Debbie lost credibility in my book with her recent crazy, arbitrary quadrant). But back to the subject at hand: Thomas. Let me ask you a question ... do you know anyone inside Thomas? Two of my good friends used to be a part of the company for many, many years. Privately held. Isolated place. And from what I hear, declining revenue (though that is speculation). They completely missed the online sourcing boat early on. The Source One deal is happening 5 years too late. I wish them luck with it, but I'd bet against them if we had a prediction market to forecast success. In fact, I'd short them if I could.
If I look at http://www.whyabe.com/buyersindex.php I can see that the utilisation of WhyAbe is pretty minimal: 4 RFXs/reverse auctions closed in the last month. Or do a search for packaging suppliers within 500 miles of Chicago. I get 8, of which from a quick scan only 1 or 2 look like real suppliers.
So from that perspective a deal with ThomasNet would be good news for SourceOne if it were able to increase their utilisation. And assuming they can figure some way to monetize any increased utilisation from smaller users.
Serious question that I am still struggling with: In what ways precisely is WhyAbe's free RFX tool better than sticking with email/outlook? Do these "masses" want a free RFX tool? Would they use one if it was offered as part of Google Apps? I suspect that email/excel are good enough for most. You don't need to read a 60 page manual to send an email.
Free lunch but it remains to be seen how many companies actually go for it.It still takes a lot for the companies to change their traditional practice. Free tools may not necessarily trigger off thier decisions
Since Harsh brought it up, does anyone know what it takes to be a "Gartner Cool Vendor?"
From what I've seen in the analyst world, I wouldn't doubt that "cool" means "paid in full," probably to the tune of mid-5 to low-6 figure range.
But I'd love to be corrected if I'm wrong here...
We are glad to see that there is such a strong reaction to this announcement. The events that you see on the WhyAbe.com website are public events. Most of the events that are run on the site are private events that only people that are invited to can see.
We agree that the supplier database on WhyAbe.com is limited. Most users of the site invite their own suppliers by email address. One of the reasons that we partnered with ThomasNet is because of their large supplier database. We have found ThomasNet to be a great partner.
You can use email and outlook to run RFP's. The downside is all of the data is contained in an email file. WhyAbe allows all events to be stored in a dashboard and shared with others in your organization. We find that companies that use the tool quickly recognize the efficiencies that can be gained. The tool also provides for reverse auctions and a contract repository.
The question was asked if the masses want a free RFP tool. Since launch of the beta on ThomasNet one month ago, over 30 public events have been run by unique companies. This shows that there is interest in a free tool. How many pay solutions have an adoption rate close to this with limited marketing? We believe that the adoption rate will accelerate as we add features and increase marketing.
It could be too little too late. We believe that people have to start somewhere. Many large companies do not have any tools. Our goal is to provide a place where people can experiment.
We are not Gartner customers and have never paid a dime to Gartner. Gartner contacted us when they were updating their purchasing tools report. Several weeks later they informed us of their decision to name us a "cool vendor".
Steve,
I appreciate you sharing the details about your relationship with Gartner. As a practitioner, I never gave one bit of respect to analyst reports because they all seemed to be pay-to-play. As a service provider, I've run into some situations where my earlier suspicions seemed to be confirmed. It's nice to hear from someone who has had a different experience.
Charles, BIQ has never paid Gartner a penny, either. We were a 2007 "Cool Vendor," along with Vinimaya.
It's always safest to run with the big dogs who are paying the bills, but Debbie Wilson calls things the way she sees them.
All this analyst stuff is pretty interesting. It's a little off of the doctor's original topic, so I'd like to invite anyone interested over to my blog to discuss things further. There are many questions there for us to explore regarding analysts there...
http://www.purchasingcourses.com/2008/06/analysts-value-in-purchasing-supply.html
To close the Gartner portion of the thread, Vinimaya, like the others, has never paid Gartner a dime for any services, etc. to this day, yet they still named us a Cool Vendor.
Regarding the ThomasNET announcement, the message to me (and I agree with it) is that content (ThomasNet) and functionality (WhyAbe) need each other, The best RFx applicatiion is pretty useless if you don't have the required supplier/part information...and having just the supplier/part information is limiting (unless you use Outlook)!
Packaged together, the value goes up many-fold...it's a web 2.0 B2B story