This company isn't selling just technology... its the e-marketplace itself not just the concept
You would think that a B2B e-marketplace company would be extremely techno-centric, touting the latest wares and techno-features, but not so with FreeMarkets Inc.. At a press meet, R. Talley Goodson, vice president and general manager, Asia, of Freemarkets insisted, "there is more to delivering an e-marketplace than the technology."
Indeed, that had seemed the case with this US e-marketplace giant. Through a 45 min or so of presentation, the media was drenched with information about the procurement process, much of it seemed like how a conventional company would go about their business.
That, perhaps, is the strongest selling point for FreeMarkets, its ability to work at a level that is compatible with how its customers conduct business outside of the internet.
This may not be such a surprise, really, coming from FreeMarkets which was formed in 1995, when internet was just taking its first steps. The concept of conducting auction online then was between being radical and somewhere out over the edge, and brick-and-mortar was still pretty much the business of the day. FreeMarkets has not lost the aura of conventional business, much to its advantage.
Founded in 1995 by Glen Meakem, a procurement executive just resigned from GE because the appliance giant balked at the idea of starting a full-fledged on-line auction business in the company, it has since grown into a major B2B marketplace company boasting knowledge of more than 150 000 suppliers and 5600 active participants in its e-marketplaces.
Earlier this year, FreeMarkets launched its operation in Asia, setting up offices in Singapore and Hong Kong. By August, a three year agreement with Singapore Technologies Engineering (STE) was signed.
This was the first media event of its kind that the company has organized to formally introduce itself to local media.
From the briefing, it is clear that Freemarkets' collaboration with its clients begins in the earliest stages, helping buyers to identify the basics of a market, such as items to bid on and how the bid is going to be conducted.
The collaboration continues well into the process of sourcing for and checking of suppliers who will participate in the auction, to after bid data collection and evaluation.
Thus far, Freemarkets has sought only MNC buyers. The list includes Owens Corning, Bayer, John Deere, Quaker Oats, and now, STE.
The clients are big, understandably, as FreeMarkets charges a subscription fee of US$3 - 4 million a year for its
services. Not a price tag that most MNC's will be able to afford. The upside is that at such a price, the e-marketplace
company is offering what seems to be a rather complete procurement process.