"Our study of eight industries
found only 43 percent of independent B2B exchanges survived between April 2000 and July 2002," explained Fein. "B2B exchanges
thought they had a great value proposition but actually misdiagnosed their advantage versus existing ways of doing business."
According
to the study, there were an estimated 1,500 B2B exchanges operating in 2000. However, the study suggests less than 200 of
these B2B exchanges will ...
"Our study of eight industries
found only 43 percent of independent B2B exchanges survived between April 2000 and July 2002," explained Fein. "B2B exchanges
thought they had a great value proposition but actually misdiagnosed their advantage versus existing ways of doing business."
According
to the study, there were an estimated 1,500 B2B exchanges operating in 2000. However, the study suggests less than 200 of
these B2B exchanges will likely survive through 2003 if the current shakeout trend continues.
"B2B exchanges were late
movers ヨ not first movers. They couldn't replace longstanding relationships in the B2B supply chain between customers and
their distributors," added Fein. "Only a handful of exchanges, such as FreeMarkets and eBay, have capitalized on the breakthrough
possibilities of the Internet."
The paper suggests other winners will be adaptive survivors, who find a protected niche
supporting existing B2B relationships, or acquisitive incumbents who buy the assets of pure-play companies at deep discounts.
The
full results of the study will be published in a forthcoming edition of California Management Review, which is published by
the Haas School of Business at the University of California Berkeley.
Pembroke Consulting is a management consulting
firm assisting senior executives from market-leading wholesale distribution, manufacturing and B2B technology companies. To
learn more about the firm visit www.PembrokeConsulting.com
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