A major study carried out for the Teesside chemical industry has raised doubts about the viability of regional e-procurement initiatives, calling instead for a UK-wide platform for the sector.
The report, produced for the Teesside Chemical Initiative, concludes that no region — even if it is a key industry centre — has the critical mass of buyers and suppliers needed to run an effective e-procurement operation.
The study by Eutech Engineering Solutions was commissioned to examine the options for a local, internet-based purchasing network.
Eutech’s Alastair Mackenzie said it soon became clear that buyers were reluctant to limit their options, instead seeing e-procurement as an opportunity to cast their net wider.
‘They said they didn’t want to just be locked into local suppliers,’ said Mackenzie. ‘The view was this would work on a UK basis, but not a regional or local one.’
The Teesside report identifies several key areas which any national e-procurement platform for the chemical industry and its suppliers should address.
Eutech claims one of the most pressing issues is cataloguing engineering goods and services to the industry, as many of them are unsuitable for conventional catalogue-based purchasing.
Users often need to be able to specify a particular product configuration. The report suggests any e-procurement platform should incorporate modules to make this possible, as well as being able to handle requests for quotes from buyers to suppliers.
Eutech identified a high level of interest in a common ‘virtual warehouse’ of engineering spares and equipment.
The report warns small and medium-sized companies that the chemical industry’s major players are already a good way towards developing their own e-procurement systems.
Suppliers in particular need to make their product information available via the major chemical industry market sites, and in formats used by purchasers’ own online catalogues.
Those that do not ‘will progressively lose access to large companies as they get their in-house catalogues up and running over the next six to 12 months,’ the report warns.
The report, E-procurement in the UK Chemical Industry, is available for £500 — or £350 to smaller components. Contact alastair.mackenzie @eutech.com