Types of Exchanges

Ever wonder how to classify all those exchanges out there? Well, now you can.

September 15, 2000 -- Electronic Buyers News -- With so much hype swirling around e-marketplaces, it's easy to get lost on even the most basic questions, like who's running the exchange or what functions each type provides.

A recent report by Boston-based AMR Research Inc. helps answer some of these questions.

The most common exchanges fall within four categories: consortium, independent, private, and vendor.

Consortium-led exchanges, like e2open.com and eHITEX in the high-tech industry, are typically focused on cost reduction, supply-chain efficiencies, supply-chain collaboration development, and asset optimization. Terms and conditions are pre-defined by members and provide industry-focused sourcing capabilities.

Independent marketplaces are owned by an individual company, such as FreeMarkets, and are considered public exchanges. The company owns the marketplace, creates liquidity, and manages interactions between participants.

Private exchanges are run by individual companies that select what supply-chain partners will be allowed to participate. Processes are moved online to foster closer collaboration.

Vendor exchanges are created by technology-enabling companies such as Ariba, Commerce One, and i2 Technologies. They, too, are centered around cost-reduction efforts and asset optimization.

Companies in this article