As a said lab rat, I think CMDX will do well as a business, I just think it will take some time. I am currently in the process of determining whether my company should use CMDX for our purchases. As I have found, it is not an easy sell for CMDX to get customers to purchase through CMDX. It takes alot of encouragement, coaxing, and hand-holding. I truly do see the value of working with CMDX, but I know others that do not. From my end, I see the streamlining of processes which in turn will reduce time and cost in matters of purchasing and payment. The negative viewpoint is that it is change, and as we all know, people are reluctant to change.
The problem with CMDX is that the cost-savings to companies purchasing through CMDX is not direct. You transfer all of your current negotiated discounts from vendors into the CMDX system and that is what you pay. There is no further discount for using CMDX. If I get a 10% discount from VWR, then that is exactly what I will get purchasing from VWR through CMDX. The cost-savings, as it stands right now, comes from the streamlining of processes. Using CMDX,
AR/AP only has to deal with CMDX. Everything is automated and computerized via the CMDX website. For a small company, this does not translate into much of a savings. But for a large company, you could save tons. CMDX is also working on getting suppliers to offer larger discounts to companies buying through CMDX. SO instead of getting a 10% discount from buying from VWR, a company would get a larger percentage to buy from VWR through CMDX. This is in the works but not happening today. Smaller companies have to realize that they should incorporate this system now while they are small which will be valuable to them when they do become large.
As you can see, this is why it will be harder for CMDX to sign on customers. It would be a much easier sell to say, "come to us and save an additional %5 on every purchase". I think that eventually CMDX will do very well. It is just this initial start-up of signing up customers where it will drag. The trick is whether CMDX can sign up customers fast enough before a)it runs out of cash, or b) competition comes in and takes a large piece of the pie. I think that once CMDX has signed up a customer, this will be a customer for a long time. It would be very hard for a customer to stop using CMDX once they have bought into the system.
Anyway, just wanted to pass on my oinions as a lab rat and a businessman. PM me if anyone wants more info.
Sam |
