Net marketplaces

Explain types of Net marketplaces.

The four main types of “pure” Net marketplaces are:

  1. Electronic distributors are independently owned intermediaries who provide a single source for industrial customers to purchase or maintain indirect products and make repairs. Electronic distributors operate in the horizontal market and serve a variety of industries with products from different vendors.
  2. Electronic contracting companies are independently owned intermediaries that connect with hundreds of online vendors who provide millions of maintenance, repair and labor products to commercial companies that pay fees to enter the market. Electronic procurement companies operate in the horizontal market, where long-term contract purchases are used to purchase indirect goods.
  3. Exchanges are independently owned online marketplaces that connect hundreds of sellers with thousands of potential buyers in a dynamic, real-time environment. They are usually vertical markets in which direct inputs (goods and services) can be purchased directly. Exchanges create money by putting a charge for every transaction.
  4. Industry consortia are industry-owned vertical marketplaces which can make lengthy deal purchases of straight contributions from a limited pool of invited members. The consortium works to decrease supply chain effectiveness by incorporating the industry supply chain throughout an ordinary system and computing stage.

Net marketplaces can also be categorized as:

  1. Buy-centric Markets: These marketplaces are organized by large and influential buyers in a place where small and retailers sell their products, such as freemarkets.com.
  2. Sell-centric Markets: These markets are organized by large and influential sellers as a place where small and fragmented buyers can buy. The organizers of these markets derive revenue from advertisements, commission on sales etc. e.g., grainger.com
  3. Neutral Exchanges: These markets appear when both the buyers and sellers are fragmented. These markets are organized by a third party who creates a neutral exchange and performs the transactions through a bid system. e.g., Arbinet.

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top