CMGI, Inc., Charleston, MA, has entered a definitive merger agreement to acquire Modus Media, Inc., a privately-held provider of supply chain management solutions with annual revenues for 2003 of $543 million. CMGI reported revenues for its fiscal year ended Jul. 31, 2003 of $437.0 million and an operating loss of $92.4 million.
CMGI will acquire all of the stock of Modus for approximately $157.5 million in CMGI common stock and a net cash payment of approximately $73 million to retire indebtedness. The transaction is expected to close in the third quarter of calendar year 2004.
Modus delivers integrated supply chain management services to companies in the hardware, software, telecommunications, broadband and wireless industries. It operates 23 centers in 13 countries. Through ...
Agilisys Inc., Atlanta, GA, has acquired daly.commerce (formerly Daly & Wolcott), East Greenwich, RI, a supplier of e-commerce enabled enterprise software solutions to the wholesale distribution industry. The acquisition will enable Agilisys to address the needs of manufacturing and wholesale distribution customers with complex distribution strategies and provide daly.commerce with the infrastructure, distribution capabilities, and capital to grow globally.
With the completion of the daly acquisition, Agilisys expects to generate approximately $250 million in revenue in FY2005. The combined company will have 7500 customers and 1200 employees globally. Agilisys will also have approximately $45 million in cash on its balance sheet following the acquisition.
Associated Wholesale Grocers (AWG), the second largest grocery cooperative in the nation, has implemented a voice-directed distribution system, an integrated software and hardware solution, in its 1,000,000 square-foot Kansas City, Kan. facility, replacing both paper pick lists and hand-held scanning terminals in its case-picking operations. AWG said that despite the precision of scanners, accuracy results with voice are at least equivalent, and frequently better, with error rates dropping 25 percent following the installation.
'AWG has always used technology to improve its operations and provide better service to our retail customers,' 'We're very pleased with the results from Vocollect's voice solution.
'Previously, we went from paper to bar code scanners to increase ...
When a major consulting firm throws cool water on the top hype topic of the day, it's worth noting. A.T. Kearney presents a rational analysis of the scramble that WalMart kicked off last year in a nine-page white paper on Meeting the Retail RFID Mandate. It has a good overview for anyone thinking about it or with customers thinking about it. The report also wins the MDM award this month for best way to end a white paper, with a quote from William Gibson, the science fiction writer who coined the term 'cyberspace' in 1984:
'The future is already here, it's just not evenly distributed.'
Comergent Technologies, Inc., Redwood City, CA, has acquired Profile Systems, Inc., West Springfield, MA, developer of product information and inventory management software solutions for business-to-business e-business. The deal pairs Comergent's strengths in e-catalogs and sales/order management with Profile Systems' work in vendor managed inventory and data synchronization/warehousing.
Profile Systems was founded in 1994 and has about 30 employees. Here's what they bring to the table for Comergent:
Revenue growth over the past two fiscal years: 74% in 2002 and 42% in 2003
Customer base in the automotive, consumer packaged goods, industrial, and healthcare industry verticals
1,000 enterprise subscription customers (across a reported 30-plus ...
Verticalnet, Malvern, PA, is adding supply chain management consulting services to its capabilities in e-procurement and spend analysis software tools with the acquisition of Tigris Corp., a privately-held strategic sourcing and supply chain consultancy based in New York City.
The deal bundles the capabilities of the two companies to now offer a suite of enterprise-wide supply management solutions including spend analysis, self-service RFX, reverse auctions, contract management, e-procurement, and supplier scorecards. In the past 3 months, Verticalnet and Tigris have announced spend analysis agreements with Cadbury Schweppes, Illinois Tool Works, and Wyeth.
Under the terms of the merger agreement, Verticalnet issued 1,870,450 shares of Verticalnet common stock plus $3.5 ...
Reverse auctions represent a sourcing strategy many distributors will be forced to cope with in the coming years ' a situation likely to upset many wholesale distribution executives. This conclusion comes from the new Facing the Forces of Change: The Road to Opportunity report (available from the National Association of Wholesaler-Distributors here.
Strategic sourcing is a process by which customers gather and use information about their own spending patterns to reduce purchasing costs. Strategic sourcing initiatives aim to counter the field-level sales and marketing efforts of wholesale distribution sales reps trying to influence local buying decisions.
Understanding reverse auctions
Reverse auctions are real-time price ...
Company accelerates SAP install after major glitches
January 10, 2004
The last issue of MDM provided a summary of W.W. Grainger's 2004 strategy and its new focus on raising local customer service levels by adding more inventory into targeted markets. This article presents details on the company's infrastructure investments, trials and tribulations over the past few years, to reach the goals outlined in the last MDM issue.
The following comments were made at an analyst meeting on Dec. 15, 2003 by Wesley M. Clark, president and COO of Grainger:
Grainger saves customers time and money by providing them with the right products at the right time, at the right place and with the right information. We are able to do this because Grainger has always been well positioned to help customers realize cost savings through our multiple ...
Amazon.com had to develop a hybrid fulfillment and procurement model where it purchases both from manufacturers and from distributors to be able to offer universal product selection and to conduct inventory turns at nearly historical levels. Amazon's VP of consumer electronics says emerging retailers traditionally bought first from a local distributor and then branch out to other distributors as growth dictates.
Amazon found the traditional scenario where the retailer then goes direct with the manufacturer when a certain volume in business is reached does not offer the best economics to the retailer, nor is it the best way to serve the customer. For instance, Amazon.com often finds it is better to pay $5 more for a television from a ...
The lead article in this issue addresses reverse auctions and the impacts ahead on distributors. The article also points to two key issues for 2004 in this rebuilding economy: internal cost management and building your competitive differentiation through service and value beyond the products delivered.
There are endless case studies of economies in transition where the leaders identify and act quickly to fill emerging needs. As the article points out, not all customers want the same level of service with the same price sensitivity. You have to clarify the menu of services you provide, what it costs to provide them, price and market these services effectively.
Distributors have the unique position in the supply channel to look both upstream and downstream to find opportunities ...