Can the system potentially automate all phases of the purchasing cycle?
For now, most Net markets don't offer end-to-end systems that make it possible for buyers to do everything from getting price quotes to placing an order and paying for goods. In fact, most handle only one part of the solution, says Forrester Research's Orlov. The upshot: Whatever the network does now, you need to make sure it's worth your while. Consider Alan Petzo, purchasing manager of Worthington Steel, a processor of flat-rolled steel in Porter, Indiana, who buys and sells steel over e-Steel.com. For the moment, Petzo can strike a deal over the system but he can't do much more than that. He still has to produce a purchase order manually and then fax it to the supplier. Even so, Petzo feels he's getting plenty out of it. We get access to hundreds of suppliers at one time, rather than having to make separate phone calls and send faxes to each one, he says.
At the same time, keep your eye on the future. That means making sure the operator has plans to bring on new capabilities. Ideally, they will agree to let you take part in developing them. The bottom line: You must have confidence that the current state of technology is just the beginning.
Olympic Steel's Miller is a case in point. For now, he only uses his Net market to bid on products; the paperwork is done off-line by hand. But he expects to see the system evolve, eventually offering the ability to complete the entire process with practically the touch of a few buttons. We're in the early stages now, he says. This is the first step.
How to see the future?
Talk to the company about their plans. Look for such issues as what languages (such as extensible markup language, or XML) they're using or whether they're working with Oracle or other key partners. And find out what technology they're beta testing. For example, while you might not be able to tie into their system with your back-end ERP systems for paying bills, cutting orders and the like, the company might be testing out such capability with bigger customers. Remember that even if you're a mom-and-pop shop years away from taking advantage of a fully integrated system, it's still important to sign on with a technically savvy Net market capable of attracting the big guys.
Can the system grow?
The buzzword is scalability. As more people use the system, will it be able to handle the increased traffic? To find out, you'll need to understand the basic architecture and how it can be tweaked to address potential trouble spots. If there's a bidding process, for example, make sure there isn't one central choke point that everything runs through and that can cause chaos if it fails. Catalog sites should be capable of holding large amounts of complex information and still be able to respond quickly to a search, even in times of high demand.