Stivison--E-commerce Has Arrived
Each year, this column has attempted to predict the hottest business or technology trend for the next 12 months. I have absolutely no doubt the trend that will have the most dramatic effect on how we do business in 2000 is the impact of business-to-business electronic commerce.
The Fundamental Effect
Previous years' columns have focused on technology innovations like PostScript, CTP and ink-jet output, and their impact on the manufacturing process. By contrast, this year's trend affects our fundamental business franchise. It spans the entire breadth of our business relationships, from how we deal with our suppliers to how we deal with our customers.
The e-commerce imperative of 2000 addresses our basic ability to compete. In this era of mega-mergers and consolidation, every large printer has an ever-smaller collection of clients. However, each of these clients is taking on more of the characteristics of the 400-lb. gorilla. And the price of keeping the gorilla happy is to leverage the power of electronic commerce, demonstrably wringing the best prices and most efficient operations from our suppliers.
And the new business model does not just apply to the top-tier printers. The trend will rumble across our entire industry, regardless of a firm's size. Certainly there is no technology barrier to entry—everybody has a PC and a modem. There is a particularly attractive opportunity for second- and third-tier printers, where the openness and level playing field of the Internet bidding bazaar makes it easier for these firms to pick up the work, and where a particular combination of current capacity or location allows them to bid competitively against the mega-firms.
The impact will even extend to the specialists: mail houses, pick-and-pack operations, consolidators, off-shore brokers and color houses. They will be sucked into an environment in which "the big fish" have to demonstrate to the even bigger fish that they are wrenching every penny of economy out of their suppliers.