South Africa`s largest business-to-business (B2B) e-commerce marketplace (e-procurement) company, involving three major listed groups, has been launched.
The new company, Miraculum (Pty) Ltd, is geared to offer significant cost savings and purchasing efficiencies to its corporate and SMME clients, as well as to government and empowerment initiatives.
Miraculum is a joint venture owned by Dimension Data, Nedcor, Old Mutual and J&J, a services and e-commerce company founded by Jay Naidoo and Jayendra Naidoo. The three listed groups will be the initial participants creating a multi-billion rand electronic marketplace, while J&J will provide access to a complementary customer base.
"Combining a technology company with the purchasing critical mass of Old Mutual and Nedcor will make this the largest B2B initiative launched thus far in South Africa," says Miraculum MD Brandon Spear. "Miraculum electronically brings buyers and sellers together facilitating the flow of information and procurement orders. Subscribers to the service can maximise supplier leverage and minimise processing costs."
According to Spear, major SA corporates spend tens of millions each year on procuring non-core products and services such as office supplies, PCs, copiers, travel and insurance. Industry benchmarks show an organisation can save up to 20% of its procurement costs by implementing an e-procurement system.
Old Mutual chief information officer, Vic Lumby, says the strength of the joint venture will ensure Miraculum`s success. "The groups involved will benefit from the significant saving in their own procurement costs by joining this electronic market place as anchor tenants."
Nedcor executive director of technology and operations, Barry Hore, says the launch of Miraculum is an important milestone in Nedcor`s e-commerce strategy.
"E-procurement is an integral component of our e-commerce solution, and being an initial participant gives us the advantage of offering a `tried and tested` e-procurement service to our clients," he adds. Nedcor will be the preferred payments provider for Miraculum.
J&J executive director, Jayendra Naidoo, believes the benefits of implementing an e-procurement solution apply not only to corporates but also to government departments, parastatals and SMMEs.
"E-procurement portals in the public sector would aggregate demand across different departments and divisions and will reduce unauthorised expenditure. This will result in reduced costs, increased efficiencies, and will facilitate tighter financial control of the government procurement process," he explains.
Naidoo says Miraculum will make best-of-breed e-procurement practices and facilities available to SMMEs. "By aggregating their buying power, SMMEs can access value-added services at a reduced rate. As importantly, Miraculum will give SMMEs access to new buyers and markets and in this way stimulate economic activity."
Spear notes that there`s likely to be a proliferation of e-procurement service providers in the future. "But - as was the case with cellphone service providers and Internet service providers when these technologies first came to the fore - few will survive in the longer term.
A major differentiator for us is that our solution is a combined exercise between procurement and technology specialists.
"We incorporate expertise in both the quality-of-service virtual private network (VPN) and Internet arenas through OmniLink and The Internet Solution (IS), companies jointly owned by Dimension Data, Nedcor and Old Mutual.
"This is backed by the know-how of experts from the Nedcor and Old Mutual buying departments. Nedcor`s head of procurement, Rod Ward, who has been seconded to Miraculum, understands the complexities of negotiating and managing procurement contracts and supplier-customer relationships."
Miraculum will be powered by Oracle`s leading B2B exchange platform and technology that will enable online auctioning, reverse auctioning, contract and spot buying capabilities. It will also facilitate collaborative supply chain planning and product design functionality allowing accurate capacity and demand planning for participating suppliers.
Oracle`s electronic marketplace solution is being adopted by the world`s leading B2B online exchanges. For example, Oracle is working with Ford Motor Company, General Motors and DaimlerChrysler on the leading automotive industry exchange; with GlobalNetXchange, a global retail exchange that initially focuses on the US$80 billion supply chain purchases of global retail leaders Carrefour and Sears; and RetailersMarketXchange, being established by Chevron and McLane for the US$200 billion convenience store industry in the US.
Spear says the e-procurement service will be targeted at the current 70 corporate users of the OmniLink VPN as well as the 1700 corporate and business clients of IS.
"This will enable us to meet the quality-of-service requirements of businesses on the VPN as well as the needs of customers with Internet access that would like to become part of a secure, e-procurement marketplace.
"Our aim is to provide a robust business platform which reduces the cost associated with procurement and allows companies to better leverage their expenditure with suppliers. The new company will initially focus on MRO (maintenance, repair and operations) goods before expanding into other products and services, " Spear concludes.
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