Old economy stalwart, Stanley Works has partnered with new economy mover, MeetChina.com to develop a customized Internet-based procurement marketplace in China. Stanley plans to use this marketplace to supplement its current Asian purchasing operations.
The companies further agreed to jointly market any new business processes that result from their collaboration and to share the financial benefits. "Today, too small a portion of our products and components are produced in low-cost locations such as China. MeetChina.com's capabilities -- its vast network of vendors and people in China -- will help us lower our product costs while maintaining our historical high quality standards," said John M. Trani, Stanley Chairman and CEO.
Customizing MeetChina.com for Stanley gives both companies the opportunity to be among the first to realize the true potential of the Internet in China, connecting Chinas massive manufacturing base directly with purchasing offices in the U.S., said Len Cordiner, CEO of MeetChina.com. This partnership with Stanley allows us to put our resources some 70,000 suppliers, trade service providers, and a team of experienced industry specialists - to use for a significant, well-known U.S. manufacturer.
In addition to the strategic alliance, Stanley announced it has invested $5 million in MeetChina.com, acquiring an equity interest in the privately-owned company. Mr. Trani added: The Internet is a key element of our business model, facilitating the achievement of productivity that will allow Stanley to be competitive and grow We are impressed with MeetChina.coms capabilities and management team, - and we believe that an equity investment in this business-to-business Internet leader meets all our investment criteria.