Redwood City, CA January 27, 2003 Demand chain software company Comergent Technologies has acquired Enduse, a provider of sell-side pricing optimization applications.
Under the agreement, terms of which were not disclosed, Comergent now owns all Enduse assets and technology, including Incentiv Auction, Enduse's flagship e-auction solution.
Founded in 2000, Enduse developed pricing optimization software designed to maximize margins on the sale of goods. Dr. Alan Marco, then a professor in economics at University of California, Berkeley, helped in its development. "Pricing models and auction theory are undergoing a renaissance due in large part to the growth of electronic commerce in recent years," said Marco. "Enduse developed leading technology in line with this evolution and the realities manufacturers face."
In particular, Incentiv Auction allows companies to combine e-auctions with volume discounting. Enduse's auction model allows the seller to establish discount reserve price schedules based on the bid quantity, which, the provider said, enables the seller to quantify the cost-savings for selling in large quantities and to pass those savings along to the volume buyer.
By making it easier to put up varying quantities of products up for sale at varying prices, Comergent believes the new technology could help its customers more effectively, and profitably, liquidate their inventory.
In addition to adding e-auction capabilities, Tom Mescall, senior vice president for marketing and business development at Comergent, said the Enduse technology would also benefit Comergent's customers by helping them respond more accurately to requests for quotes while maximizing sales margins.
Kent Allen, research director at technology consultancy Aberdeen Group, said Comergent's latest acquisition may be well timed since he increasingly is hearing from his consulting customers that pricing optimization and excess inventory liquidation are set to be a driving business strategy in 2003. "Comergent is ahead of the game by adding this new capability to their solution suite," Allen said.
Comergent said its customer-facing software applications enable enterprises to streamline and automate their sales and order management processes while making it easier for their customers and partners to do business with them. The Enduse acquisition will add such functionality as variable price quotes, volume discounts and online auctions to Comergent's software offering.
"By providing more pricing strategy options, Comergent customers can more effectively maximize their sales margins on goods and services," said Jean Kovacs, president and CEO at Comergent.
John Rough, chief information officer at Comergent customer Castle Rock Industries, offered a positive take on the acquisition. "We are excited about this new offering and are interested in how it can benefit our sales strategies," Rough said.
Mescall said the Enduse technology would be a key component in Comergent's drive to expand its demand chain solutions footprint. "The benefit to Comergent and our customers is that [the acquisition] continues to expand the breadth of our functionality," he said. "Now we have the ability to offer comprehensive pricing and e-auction technology along with our previous technology for e-commerce, product management and channel management."
The Enduse technology will be fully integrated into Comergent's overall platform and offered, as are the provider's other solutions, as modules running on top of that platform, Mescall said.
Additional Comergent customers include such companies as Cisco, Maytag, DuPont, Nissan, Continental Tire and Toro. The provider's primary target vertical markets include high tech and electronics, automotive and aerospace, industrial manufacturing and consumer packaged goods.
Mescall said Enduse had "a couple of what I would call Beta customers" that will continue to use the software.