John Wolz

FastenerExchange.com and Partini.com created excitement in the fastener industry in 2000 with splashy global advertising and trade show presence.
Though the two widely promoted fastener dot.coms and several lesser-known web sites disappeared earlier this year, several B2B e-commerce sites remain active.\
News from a sampling of three of the fastener e-commerce operators expresses optimism.
Jeff Ferry of 1stfastener.com said membership has doubled in the last three months. The company, led by George Wasmer and Ferry, both members of multigeneration fastener families, released an upgrade of its software program last month.
Last summer e-fastener.com returned to independent status after being acquired by Partini in 2000.
President Greg Fields reported that page views have increased 54% since e-fastener.com relaunched in June. In August e-fastener recorded new highs in both page views and unique IP addresses.
In our first 3 months more than 400 buyers have registered to use the e-fastener.com marketplace, Fields noted.
Ralph Nissen was seeking venture capital for tradesys.com/fasteners last year and now realizes it is probably good we never got funding. His Industry Trade Systems ITS Inc. consequently didn’t launch an expensive marketing campaign for tradesys.com/fasteners and now isn’t buried in debt.
With little marketing we have grown at a pace we can handle. It has been all Internet generated, Nissen said.
RFQs on tradesys.com/fasteners are growing at an 8% per month clip, Nissen said.
Nissen attributes the portal problems to a serious problem with the business model. In hindsight it shouldn’t be surprising. One spends a lifetime developing relationships. You can’t afford to risk those relationships on standard orders.
You want to know your supplier sources of standard fasteners, Nissen observed. Thus most of our RFQs are for specials and hard-to-find fasteners.
When standards are ordered it is almost an immediate red flag. Is there a bad credit problem here?
Several other sites continue to struggle. Some fastener advertisers report banner ads have appeared not only free, but also without even the advertiser being notified of the ad.
Chapman: E-Commerce Still the Way to Go
Less than 18 months ago Jerry Chapman was excited to jump into the dot.com world as North American CEO of FastenerExchange. Last April when venture capital dried up, Germany-based FastenerExchange was shut down. Nonetheless Chapman remains bullish about B2B e-commerce.
It is the way to put buyer and seller together in the most efficient manner,  Chapman commented. B2B e-commerce is going to come back. It has to. Ultimately quality, delivery and lowest cost win out.
Cutting costs is even more important in a slow economy, he added. Fastener distributors and manufacturers are going to have to look at the Internet as one of the ways to reduce those hefty transaction costs.
When Deutsche Bank pulled out financing more than 100 Internet companies closed down.
Chapman thinks the bankers made a mistake in eliminating funding. It was like if your hand was bleeding and they cut off the whole arm instead of fixing the wound, he characterized the situation.
By cutting off funding the Internet sites closed down instead of cut back. They threw away everything they had funded,  Chapman commented.
We were doing better than expectations, Chapman said of FastenerExchange. We were achieving our goals.
Chapman noted that several fastener portals changed their strategies during their short business lives and were on the verge of success.
We were right there. We were within six months, Chapman said of FastenerExchange. We would have had positive cash flow and been well on our way to profitability.
After the demise of FastenerExchange, the former vice president of MNP Corporation’s fastener distribution group reopened his TriStar Consulting.
Chapman pointed out that most of the B2B e-commerce sites learned a lot of lessons quickly and several changed from their initial plans.
At first FastenerExchange focused on the buyer and the seller with online inventory. After a few months the focus shifted to creating connections between the buyer and seller.
FastenerExchange became a defacto partnership. We had manufacturer and distributor systems talking to each other. Instead of buyers having to go into eight or nine web sites they could go to just FastenerExchange.
The idea wasn’t as popular in Asia. The Taiwanese don’t want this to happen, Chapman surmised. They felt that the web site would simply lower their selling price.
In his travels promoting FastenerExchange Chapman found fastener distributors were skeptical of the Internet. People are always afraid of new technology.
The B2B e-commerce companies forgot to pay attention to where the market was, Chapman observed. Fifty-year-old fastener CEOs were not moving to the Internet as fast as younger employees at lower levels.
Chapman noted the children and grandchildren spurred many adults to learn e-mail, because it became the only way to be in contact with them.
About five years ago Sony placed its owner’s manuals online, and everyone discovered companies could save millions of dollars.
Chapman said that in the future more sellers will put pricing, inventory and ordering online and buyers will go to numerous sites to buy. Buyers will hate entering two orders  one online and one in their system  and will want one place to enter their orders for themselves and their supplier. Then system-to-system connections will be established and the B2B exchange will be reborn.
Chapman also thinks this is a good time to get involved in the Internet because anything web related is at its lowest price ever. Internet development companies are competing for the first time to get even the smallest piece of business.
© 2001 FastenerNews.com