Dotcoms Extoll the Potential of E-Contracting
Using Referral ServicesTwo of the panelists, Steve Miller of RepairNow and Greg Rispler of ACDoctor, represented contractor “referral services,” B2C companies that link consumers to a network of preferred service providers. They were questioned about the criteria for choosing a referral service.
“Contractors can choose if they want C.O.D. business from their residential end user, a revenue stream through insurance companies and extended warranties, or if they are looking for new home construction,” said Miller. “We operate on the assumption that contractors want electronic business rather than phone calls and paper.”
“You have to look at a number of different referral sites, just like you look at different types of advertising,” added Rispler. “You need to get your feet wet. Some of our members said they only needed one referral to pay for their membership [in ACDoctor].”
Manufacturers are concerned about the qualifications of contractors who install their equipment and are listed with these types of referral services. Miller said, “Contractors must have a signed affidavit to guarantee delivery of services; an insurance certificate; we run a credit check and a check with the Better Business Bureau; and we have copies of all local licensing on file, which are maintained on a regular basis.”
Business ServicesB2B companies represented included HVAConline, Buzzsaw, and eCaribou. These companies offer business services to contractors and have no direct contact with the end user.
Buzzsaw has “orange page listings” which include preferred manufacturers, distributors, and contractors who can interact through their common website. “We have a number of manufacturers who are willing to pay to have their suppliers and preferred contractors listed in our orange pages,” said Buzzsaw’s Anne Wright. “This helps to extend their reach into the public directory.”
Knowing which website portals are available is also important to the procurement side of doing business. “We may need an entirely different web strategy when it comes to procuring goods, materials, and services,” said Axlin’s Jim Poulin. “You need to understand web portals and need to manage the consumption of materials.
“But do not try to tackle [many strategies] at once. If it is important to get revenues, do your revenue side first. If it is important to make your business more efficient at less cost, do the procurement side first.”
B2B is not just a gathering spot for businesses to meet, it is also a place to learn about business tools. One example is eCaribou. “We provide marketing programs, sales and sales analysis programs because you have to be able to analyze your data to know how much a sales lead is going to cost you,” said eCaribou’s Jim Townsend.
Integrating the Systems Another IssueAnother issue raised was the integration of different “systems” into a common, understandable language. “The integration issue is very important, and Internet development is running on overdrive,” added BidBuyBuild’s Gerald Lieberg.
“Companies are developing back office capabilities with announcements coming on a daily basis. There are companies coming up with powerful tools to ‘take the pain’ away from [users].”
“The important thing to think about is leveraging existing technologies,” said HVAConline’s Marci McCarthy. “Your back office should be paperless in nature. For example, you can leverage your inventory by keeping track of it and going to your desktop and placing an order with your distributor. We are doing seamless back office connectivity [translating existing ordering systems] so there is an easy two-way communication between you and your customer.”
“We are trying to provide our customers with a clean set of data that they can turn around and use as information to their customers,” said PartsClick’s Michael Avari. “We are making sure the return on investment is there for our customers before we take the next baby step.”
Avari suggested that if contractors have distributors who still utilize the “old channel” of distribution, they should speak up. “Go back to your wholesaler and tell them you want to go e-commerce. Force them to make that decision.”
The Bottom LineLearning about new Internet technologies and the wonders of e-commerce may be the next wave for hvacr contractors, but for many, the bottom line is still the cost of integrating new systems. Townsend addressed that concern.
“You can’t afford to invest a lot of money and time to justify a good return on investment. The advantage of using software over the Internet is that you don’t have to put down six figures or five figures. You simply have to pay a monthly fee and start with small steps, not large steps.”
“Put together a strategy that is scalable and buildable — take those baby steps,” added HVAConline’s McCarthy. “Do a due diligence on the vendors you want to work with and align them with the technology you need.”
Evangelizing the MessageSince hvacr contractors in the United States number over 30,000, and approximately 75 showed up for the e-Contracting Summit, the panel was asked how companies can get their message to the many people who cannot attend these meetings or who do not understand the changing technology.
McCarthy said her company is planning to attend local chapter meetings to talk about Internet technology. Wright advised contractors to talk to competitors in their communities, to become “evangelists” and show them what they are doing with the Internet through a “word-of-mouth” campaign.
One contractor in the audience summed up his thoughts about today’s e-commerce challenges. “Welcome to the bleeding edge.”
Sidebar: E-Business PanelistsAttendees of The News/ACCA e-Contracting Summit were addressed by a panel of experts who represented various businesses related to the hvacr Internet community. The panel included:
Publication date: 11/13/2000