22 MARCH 2001

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(Source: Electr,onic Business Revolution: Cunningham & Froschl)

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• Current business m()d~elsaJlow for effective trading

~ Identify a need

- Negotiate terms

- Trade

- Payme

- Essentially the same

- Touches on optimisa1tion throughout the process

- Assists with identification of possible traders

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11 SA ??

-Rate of adoption in Sfo~ relatively inco.mparlsonto other

• Approximately 0% of adopted e-Commerce

igh-income households in SA have

• Travel and accommodation is by far the largest category of consumertransactions

• I-Inancialser\tice.sg impressive of late

"e--Commerce activity has been

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Gre e1r e-4C e

• The Green paper was released recently indicating thepoHcy issues and points of discussion which be address in the _.

• I ncgovernmeht stateej that the electronic "economic revolution"presents a unique opportun for less developed countries to expand internal and external markets

- External: cost international trade

-Internal: Pr~9viously "marginaHsed" groups now able to gain access to financial and other economic sources

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• Challenge: to narrow the >g.ap between "information haves" and "information have-nots"

• IT not achieveej- the gap be ever increasing

• Ur'cess to phys.ical network and Internet connectivity is esse tlat

• SMME's are slow to ernbrace the use of.lnternet because of :

-" InfrastructureavaHability

-Skills base

- Digital literacy

- Working capital

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• Initiatives fro·mGovernmeni- esiablishme.ntof :

--MultipurposeCornmunityC.enlers (M PGC's)

-- Telecenlres

-Dept of Connmunicatflons Internet Laboratories

- .Public Information terminals

Issues eedingattentio- .

-- Telecominfrastructure

- lSP'sin rural areas

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• Sasollauncheda Joint initiative with CommerceOneSA arch 2000 and set up MarketSite

• The different divisions of Sa sol have sincekicked ... off with electronic procurement at 6 rnaJor business units

• As part of this initiative,CommerceOneundertook to develop a atform through whi.chSMME and BEE's would be able to

transact

• Develop'mentof ProQure together with another Sasot service provider to e able tendleringprocessvialnternet technology speciftcal focussed on -S E's

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- Tool to assist with tencJeringprocess

- Does not substitute strategic decision-making

- Assists with re.porting and communication

- Simplifies the process and consolidates informatio

-AllowsstandardIsation and consistency

- allOWS for easy access by SMME & BEE supplie

-Consolidates current su.ppHer information in ERPwithnew suopliers registered on the system

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• Supplier registers on system

• Information captured:

- Supplier info

- Scope of work

- e-Mail address (compulsory)

-Contactdetails

- Category of supply

· Goods or service

"Description

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• Procurement ()fficeridentifies the need

• Loads the need On the system work

• Indicates:

- Open bid or closed bid

- Category of work

- Closing date of tender

- Any>specialinstruction

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description of scope of

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- Supplier mayvlew the details of each tender on the system

- Suppliers submits tender on Web site using allooated logln

-Bidscomein to Sasoi'vi,a e-ma

·Procurementofficercalnnot open the bid before the closing date

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ay.change the bid any time after ""~"" closing date

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Et I Ince tne time has lapsed, the procurement officer will filter e information as required

sing predetermined criteria

- Value

- Geographic information,etc

Et Procurement officer e'laluates short list of supp "ersand evaluates quote according to set commercial procedures

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• Award of contract

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• Automatic not~fication to successful supoHer via

- SMS; or

- e- ail- or ,

- Both

• Auiomaticnotification to unsuccessful suppliers

• Completion of work and payment through normal channels

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TobrinQ.SMiME & ,BEE suppliers into the mainstream economicactivily-Sas61haspreviously setupaanon-profit organisation (HBDC)

.• SuppliersgQ the<theHBDC to register and receive assistance te'nderprocessand financial backing

• I ne HBDC will supply hardware and training to ensure digital literacy andconnectivityJo thosesup.ptierswho do not have access to the Web

• Suppliers have the responsibility to check theWebpa.ge for available tenders

• I he initiatives as proposed by the L:iovernme widerapolicationand access

also assist

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C Buyers

Products selected from catalogue, requisition approved an Purchase Orders sent to Market Site

Payment is . effected through· a payment gatewa}t·~ or purchase card (Amex,Visa, Mastetcard,etc)

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MarketSlte-Based Tradin Communities

[ Product Delivered

Market Site sends Purchase Orders to individual suppliers

Buyer is invoiced

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