1、1,B2B Organizations The Steel Industry,Akcaglayan, Halit Bortey, Ishmael Chang, Thomas T. Chien, Jane Y Cukier, Juan J,2,“Selling steel over the Internet is very embryonic. It could become an A, or it could be not much. But it would be nave to close our eyes to the Internet.“ - USX chairman, Tom Ush
2、er,3,General Facts About the Steel Industry,Worldwide production is over 750M tons of the 3.000 different catalogued steel types available. China, US and Japan are the largest steel-producing countries, followed by Germany, Russia and Korea. Steel use is closely linked to the wealth of an economy (e
3、.g., steel “consumption” per person is about 20kg in Africa, against 420kg in the US). The industry employs about 1.3M people worldwide.Source: International Iron and Steel Institute,4,Key US Players,Source: International Iron and Steel Institute,5,Steel and the B2B Model,B2B in the steel industry i
4、s characterized by: Small market segments Big amount purchases, both in money and volume High expectations for service Knowledgeable buyers Most based on auction model (value is created by spatial matching of buyers and sellers),6,Market Share,By 2001, $32 billion of steel will be sold through inter
5、net portals compared to only $150 million today Morgan Stanley Dean Witter By 2005, 40-60% of all metal produced in the world will be sold via the Internet E-commerce in metals sector is still in infancy about 3% of total sales (Andersens global metal practice),7,Space for B2B sites to operate,= Spa
6、ce for an online steel site to operate,New Value Chain for MetalSite,Raw materials, coal, iron, scrap metal,Integrated or Mini mill about 60-80 producers,Toll process, Distributor, Service centers about 10,000 intermediaries,8,Major Players in the E-Industry,MetalSite Metal Suppliers Online Metal Ne
7、twork Exchange Services E-SteelAll sites are relatively new. MSO was the first-mover, on Feb 1997. All use rigorous qualifying standards before permitting companies to sell and buy online.,9,Online Front Page Samples,Membership is highly sought,All sites provide multiple sources of information,10,Ho
8、w Do They Attract Customers Online?,Cold calls (most) Direct mail (most) Links from .org-steel related sites (all) Exchange of advertising for links (most) Word of mouth (all) Search engines (all) Physical presence in conferences and seminars (all) Recommend this site button (MSO),11,Three Component
9、s of Online Steel Sites,Buyers, who can: Buy direct from steel manufacturers Bid and negotiate deals Order, ship, track and pay online Sellers, who can: Reduce selling costs Select buyers (be in control) Bring on new buyers economically Take no cost risk of being on the Net Industry managers, who ca
10、n: Read specialized news, industry analysis and editorials Research and compare global metals industry specifications,12,Advantages of Being Online,Provides an honest, secure and anonymous platform to trade metal distribution services. Gives metal consumers the means to post inquiries which are imme
11、diately relayed to MNXS vendors that supply similar materials. Further reach for sellers Better prices for consumers Lowered purchasing costs Online auctions,13,Online Auction Operation,A mastery of the subject is needed when auctioning,Source: e-Steel,14,Incentives For Customers to Return,Online ut
12、ilities Specifications search Materials property data Metric converter Glossary Subscription to newsletters (all) Online donation capabilities (most) Extensive archives, statistics, and databases Updated regulatory information,15,Careers databanks (MSO) Bookstore (most) Calendar with industrys event
13、s (MSO) Updated steels news (all) Industry links (all) Very strict privacy policy (all),Incentives For Customers to Return (II),16,Suggested Strategic Moves,Create virtual private marketplaces These would preserve pre-negotiated terms and relationships between buyers and suppliers for future referen
14、ce. Increase security on transactions Currently, no encryption is used, although privacy is a major concern among customers Redesign pages; do not clot with information Offer specialized advice and counseling Implement a “guest” section Most of the sites are only available to subscribers,17,Suggeste
15、d Strategic Moves (II),Grow towards “meta B2B portals” Provides closely related products Allows sharing of infrastructure and services Offer educational tours about the industry Offer links to the participating companies Establish consultant / consultee relations, not only seller / buyer Remind buye
16、rs about offers according to previous purchases Personalize pages,18,Suggested Strategic Moves(III),Expand into International markets Standard Steel Language- sites should be consistent with the way they describe steel terminology. Create some kind of online CAD hosting software For product customization Move into other types of Internet transactions other than auction/direct offers. For example. Sites could offer Virtual marketplace and Collaborative Direct Transaction types.,
