The Internet is becoming a full-fledged channel for consumer and B2B e-commerce. Gartner Group forecasts worldwide B2B online sales to hit $403 billion in 2000, then increase to $923 billion in 2001, $2 trillion in 2002 and finally $4 trillion by the end of 2003. Its estimated $7-trillion peak in 2004 represents 7% of the total forecasted $105 trillion in global sales transactions. The combination of investment financing and spending over Internet commodities will add to an unstoppable growth in the B2B sector. IT is the key to keeping up with the ever-changing retail environment. Retailers are focusing on changing retail IT systems to take advantages of these changes. This aims at dynamic sharing of information between new and existing trading partners in order to enhance the supply chain efficiencies, from manufacturers of raw materials to retailers.

Retail exchanges

Electronic market places are changing the way retailers trade with suppliers and other companies. Several e-commerce initiatives are taking shape to establish B2B trading hubs that match retailers’ needs with their suppliers. B2B retail exchanges bring multiple buyers and sellers in a central hub where they can collaborate and negotiate. One example is the world-wide B2B retail exchange program, a joint effort by major retail companies in the US and Europe with the goal to bring together more than 30,000 stores with annual sales of well over $300 billion. This is to enable retailers to communicate and do business with suppliers more easily over the Internet. It will provide for public and private sharing of data and also include auction capability.

Retailers now face the challenge of developing a framework to integrate retail information systems to take advantage of Web-based technologies. They can do this by interfacing their back office systems, inventory, sales processing and credit authorization applications with new point-of-sale kiosks and trading-partner systems. This calls for an open system standard to build the retail business interfaces by providing a way of specifying data interchange that is truly independent of platform and technology.