The converter's guide to online buying

A host of new dot-coms are hoping to snag a piece of your purchasing budget for paper, inks, and chemicals. Should you take the plunge? Here are some common-sense tips for testing the e-commerce waters.

By Melissa Larson, Managing Editor -- Converting Magazine, 1/1/2001

You've known this simple fact for some time, but now the moguls of electronic commerce have also realized it: your company buys things! Rolls of paper, plastic and foil, ink, converting machinery (new and used), chemicals, ancillary equipment-even transportation and warehouse services.

The converting industry, following closely on the heels of the packaging industry, has emerged among the prized new markets for electronic buying and selling. A glance at Converting's most recent circulation data shows a tantalizing $145 billion in buying power concentrated in the hands of a relatively small (about 45,000) number of buyers. It's no wonder they're after your business.

Well, so what? Does that mean you should buy everything online? Probably not, at least at first. Buying rolls of paper online is a bit more complicated than it was to snag holiday videotapes and books on Amazon.com. But you may want to start carefully investigating some of these new services to see what they have to offer your operation. Call in a cyber-savvy 20-something staffer if you need a primer on Web surfing in general. Then type in a few Web addresses and see where they take you.

As always, when you're trying something new, it makes sense to follow some basic guidelines so that you don't waste time or money, or worse, wind up compromising your company's confidential financial information.

Is it live?

Many marketers whose advertising you see in magazines or at trade shows don't even have a fully-functioning site yet. If you enter the touted URL and are met with nothing but "Under Construction" messages, move on and come back in a few weeks.

Whose site is it, anyway?

When checking out a Web site for the first time, click on a home-page button labeled with some variation of the words "About Us." It should reveal some information about who owns and runs the enterprise. Why is this important? If it's a site owned by one or several suppliers, it's likely they're pushing their own products. There's nothing wrong with that, as long as you know it up front. While you may want to eventually find a site that offers you the widest choice of products and manufacturers, it may also make sense to start out with an online purchase from the proprietary site belonging to one of your current vendors.

It's worth pointing out that not all of these sites function the same way. For some, the goal is to bring buyers and sellers together for bids, negotiating terms, etc., and then leave the two parties to complete the transaction the old-fashioned way-through a written purchase order. Others facilitate completing the transaction online. Still others function as not much more than online buyers guides-listing choices and leaving you to contact them directly. Within a couple of weeks of investigation, you'll be an expert.

What's in it for me?

Beware the tendency to jump on the e-bandwagon just for the sake of it. After careful research, you may not find that the sites currently out there offer any advantages over the way you currently purchase equipment, materials and supplies. To earn your business, a B2B Web site should communicate a clear advantage, such as: reduced paperwork, speedier processing, a wider supply base, more efficient negotiating, better prices, or electronic management of your orders. And they should state those advantages clearly in just a few sentences. Don't fall for marketing technobabble-it can be rampant.

Call Security!

Any sophisticated site where actual buying and selling is taking place has put in place a wealth of encryption and other security features. In fact, unless the browser you're using to access these sites supports 128-bit SSL security, you may not be allowed to participate in financial transactions. If you get such a message, you'll need to contact the site administrator for directions on upgrading your browser to comply with their requirements.

This level of security is aimed to reassure both buyer and seller that their transaction is private and secure. Your competitor will never find out about a paper purchase you made on one of these sites, any more than your next-door neighbor could hack into the Sears Web site and find out about the lawn mower you ordered last week. That said-make sure the site has some sort of stated policy that they will not sell any information about your company or its buying habits. Look for a button labeled "Privacy Policy."

Getting to know you.

At many sites you'll have to register (name, title, company, address, e-mail address, etc.) before accessing more than the home page. Don't be put off. This is for their protection and yours. When you get to the point where you actually intend to do business at the site, you (or your purchasing agent) will probably also have to fill out an online form stating your purchasing intentions and establishing credit. Remember, on most Web sites, only some of the registration information fields are labeled "Required." Other information is optional. Use discretion.

Look for those extras.

The best of these sites function as exchanges of information, not just trade. They have a host of extra features, including everything from business news relating to converting materials and stock quotes to import/ export data and reference libraries. Sites devoted to inks and chemicals (www.gesilicones.com and www.fobchemicals.com are examples) often provide extensive Material Data Safety Sheets (MSDS) and other usage and disposal information online.

Request a bid or submit a test order.

Most of these sites have some sort of demonstration or simulation to walk you through a transaction before you actually commit yourself. PaperExchange's (www.paperexchange.com) Transaction Demo is particularly slick. Be sure to read the site's "Terms and Conditions," and maybe even have a third party who is knowledgeable about your business (an attorney or accountant, for instance) glance over your shoulder before you hit the "Submit Order" button.

Let them know how they did.

Be sure to offer feedback to these sites, both those you like and those you don't. Virtually all of them provide a button on the home page labeled "Site Feedback" or "Contact Us." All of these enterprises are, to a greater or lesser extent, works in progress, and all would be grateful for your opinion about order efficiency, ease of use, technical support, etc. They want to get more business, and to do it they have to please you.

Calling all early adopters!

You'll find one more willing ear when it comes to your online buying experiences: Converting. Whether it's one month or one year from now, let us know when you've stuck your toe in the water for the first time, and how it went. Which sites work well? Which ones don't? Which ones have the most useful extra features? Or, if you have no interest in adopting this new way to purchase, tell us why not.

E-mail mlarson@cahners.com or call 630/320-7453. Contact us from links on our Web site: www.convertingmagazine.com or see page 87 for our addresses and phone numbers. We're as interested as you are in how this new technology will affect the converting industry as a whole, and your business in particular.

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