The Impact of Internet Exchanges on Business-to-Business Distribution

Abstract

The authors review an incumbent business-to-business distributor of electronic components faced with the entry of more than 50 Internet-based competitors and offer an explanation for why the distributor prevailed. Underlying the explanation is an assertion that the appropriate unit of analysis is the buyer-distributor-seller triad, not the buyer-seller dyad. In the case examined, the channel activities were interrelated such that when each party calculated the costs and benefits of the activities that occurred within this three-way relationship, they outweighed the net gains from disintermediation or Internet intermediation. Particular conditions favoring the status quo included existing activities for sharing customer identification information between the distributor and the seller, a high proportion of negotiated distributor-customer contracts, and new entrants’reliance on open technologies. While no claims are made about the generalizability of this explanation beyond the case studied, the authors believe their assertion and hypotheses may have broader applicability.

Factors influencing e-marketplace adoption in agricultural micro-enterprises

“…The value that these relationships offer exceeds the perceived value of e-marketplace participation. Choudhury, Hartzel and Konsynski (1998) and Narayandas, Caravella and Deighton (2002) found similar results in the aerospace and electronic parts industry respectively. When asked about the value his stock agent gives him in terms of trading, F1 (sheep and cattle farmer) replied… "Basically his experience and expertise really.…”

Impact of Boundary‐spanning Information Technology and Position in Chain on Firm Performance

“…Chircu and Kauffman (1999) stated that traditional intermediaries will ''fight back'' against disintermediation by seeking to strengthen links with other firms in their supply chain. Narayandas, Caravella and Deighton (2002) noted that there is less likely to be disintermediation when distributors perform such boundary-spanning roles as customer identification for manufacturers. Malone, Yates and Benjamin (1987) described how computer-based markets in the pharmaceutical industry have allowed distributors to establish electronic links within the industry in an attempt to monopolize busi-ness.…”

Manufacturers’ reliance on channel intermediaries: Value drivers in the presence of a direct web channel

“…However, widespread talks of disintermediation from the early years of the web, with manufacturers expected to reduce reliance on intermediaries, have not come true. Contrary to predictions, indirect intermediaries have not only survived, but thrived in many industries (Narayandas, Caravella, & Deighton, 2002;Rosenbloom, 2007). It is important to understand the factors that contribute to the continued presence of intermediaries in the value chain concurrent with the digitization of selling activity by manufacturers.…”