B2B In The Smart Shed

B2B was hyped, didn’t match expectations and failed. That’s why Keith Roberts, managing director of the Smart Shed, stresses “Underpromise, overdeliver.”

The Smart Shed is a Vertical B2B marketplace for the household goods industry (beds, furniture, appliances, etc.), a joint venture between, among others, Comparex (through PQ Africa) and Steinhoff, with no single shareholder holding a majority share.

Roberts believes his company understands how to build a successful marketplace. First, he notes that it should be a business driven technology solution, not a technology driven business solution. In other words, examine the business needs and assess how to meet them before developing the technology. This is how the Smart Shed managed to set up the technological side of their marketplace in roughly eight weeks: by first understanding the household goods industry.

Secondly, get the right partners, Roberts says. The Smart Shed’s shareholders represent, on the Industry side, roughly 1600 out of 4000 stores and 70 percent of the bedding manufacturing capacity in South Africa. On the fulfillment side, they have established logistics partners (Roadway Logistics) and competent technology allies (PQ Africa, Comparex and i2). They are also developing a relationship with Deloitte & Touche, having identified business intelligence and change management as client business needs.

This leads to Roberts next point: he believes in outsourcing everything non-essential to the business. He holds out his staff complement as proof of this: the Smart Shed currently employees six people — theoretically making them small, fast, flexible and adaptable.

Speed and adaptability are further supported by the company’s incremental approach: identify what you can achieve and do it quickly, offering the basic service as soon as possible. Then, as you continue to roll out, you introduce refinements and add services — preferably on a “parallel project” basis, with several initiatives being examined and implemented concurrently. The Smart Shed aims for 8-12 week turnaround times for each project.

The Smart Shed began its first stage roll-out in March of this year and Roberts reports a high level of satisfaction from the involved partners, notably regarding service levels, process streamlining, problem avoidance, ordering and pricing. Interestingly, Roberts says that the marketplace introduced benefits for the companies even before the marketplace was switched. Simply by getting competitors to sit down and talk with each other they managed to wrinkle out problems.

Roberts believes in industry-specific vertical marketplaces and doesn’t believe that the household goods industry — and by implication, other industries — will support more than one such marketplace. But he does think that niche players — offering services tangential to the marketplace and industry — will arise to address specific needs.

Things have been tough for Internet-based businesses the last year. But Roberts believes that now is the time to act: as the dust settles, true e-business is coming into being.

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