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Software Manages Supply Chain For Big Manufacturers
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Business New Haven
9/4/2000
By: John Florian
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Simply stated, a project moves faster and more efficiently when everyone's in the communication loop simultaneously. That's hardly a simple feat for large manufacturers juggling dozens or even thousands of suppliers, of course. But today, B2B software from Milford's Eventra puts manufacturers and suppliers on the same (Web) page, cutting days from the supply process. Eventra President and CEO Stuart J. Sawabini explains.
Stuart, what's the concept behind Eventra's software?
VendorSite is a web-based software tool that enables large manufacturers to communicate with their direct material suppliers faster and more efficiently. This in turn reduces their inventory lead times and reduces costs. For instance, Pitney Bowes, one of our customers, builds postage machines. They buy parts that go into the meters, and those parts are referred to as direct material. They become a part of the cost of goods sold.
What's a manufacturer's main concern with direct materials?
Let's keep the example of the postage meter. The manufacturer's engineers design it, and suppliers are found to fabricate the parts. Suppliers look at the specifications, a price is negotiated and the manufacturer issues a purchase order. Not just for one part, but for the entire year, typically as a blank purchase order.
But how many parts will be needed on a day-to-day basis? Ideally, you want the parts delivered when you are ready to build the postage meter. But if the supplier delivers your parts late, it could shut down the production line. So communicating this direct-material information is critical. Having material show up on time is critical. If these aspects fail, the manufacturing process potentially fails.
And that's where VendorSite comes in.
Exactly. Our mission is to become the indispensable gateway through which all information travels between the manufacturer and its direct suppliers. This starts at the very beginning of the process with the request for quotation. Then comes the response. The purchase order. The manufacturing planning schedule. The commitment response. Shipment information, supplier certification, warranty and repair, defect tracking - you name it. Everything from the birth of the product all the way to payment.
So rather than taking days to communicate all this through overnight packages, faxes and e-mails, the information is available to everyone at the same time. This shrinks the supplier lead-time by days, and the time to manage that information from hours to minutes. VendorSite knows when everything must happen. For instance, if a part from California needs to be in Stamford on Friday, it better be shipped by Tuesday. If a notice of that shipment is not placed into the system on Tuesday, an e-mail automatically goes to the supplier and manufacturer giving them a heads-up: 'Hey, we're about to have a problem here.'
Are suppliers accepting this change?
This is a thing of beauty for those guys. It's a business tool for communicating with their large customers. And they bear no cost. All they need is Internet access and a Web browser. The objective is to reduce costs for both the manufacturers and suppliers. It's a win-win situation for everyone.
And about your company…
Looking ahead, we want to build the foundation for collaborative supply-chain management. And our company is growing rapidly. We have about 110 employees in Milford now and expect about 160 by year-end. We also have great ties to Connecticut in many ways. Two of our biggest customers - Pitney Bowes and Kaman Aerospace - are located here. Other big customers include major manufacturers such as Blue Bird, the bus manufacturer. Our early seed money came from Connecticut Innovations Inc., and major growth capital from Whitney & Co., the venture capital firm in Stamford.
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