Last month, Jenny Hampton reported on how local merchant Jackson Building Centres is dealing with the impact of the internet. This month, Ian Goldsmith, Travis Perkins' strategic planning director, explains how national merchants are rising to the challenge
The internet has created one of the biggest changes to our working lives, but Travis Perkins' Ian Goldsmith is not one to get carried away with all the excitement. "When the fax came, people said it would be the end of all written communication, but it wasn't. There's a similar degree of hype about ecommerce. It's a very effective tool for targeting particular markets and reducing administration costs, but I don't see it having a particularly dramatic effect."

Some builders merchants have been the prophets of doom as far as the internet goes, predicting that construction managers will increasingly deal with manufacturers directly over the web: but Goldsmith refutes this claim. He says the reason for merchants to be there has not changed. "If somebody wants a small volume of goods local to their site, the most effective way of getting it there in terms of logistics is to pick it up from your local merchant.

"Travis Perkins is the leader in heavy building materials in this country and is able to offer a truly nationwide service. It makes sense to have these goods delivered to each branch direct from the manufacturers and then distribute them from there. I don't see that changing dramatically."

Goldsmith also says that nothing can replace the personal touch. "There are a lot of relationships between builders and members of staff at their local merchants, and that personal contact is important.

It isn't quite there with the internet, which may be a barrier to its use."

Some merchants also claim that the branch network will give way to central distribution centres as more and more goods are bought through the web. But Goldsmith is forthright about the survival of the branch network. "While the volume of transactions being done over the web will undoubtedly grow, I don't think we will get to the situation where 80% of transactions are being done over the web. It's nonsense to say there will be no branches any more."

If somebody wants a small volume of goods local to site, the most effective way of getting it there is to pick it up from your local merchant

For those working on site, there is often a major stumbling block to internet use – no computer, which Goldsmith admits is a problem. "You can have all the internet functionality you like on your website. But if there is no internet access on a building site, no one there is going to use it. You are seeing PCs on site increasingly, but the development of the WAP phone and its successors will have a greater effect."

WAP (or wireless application protocol) phones allow internet access through your mobile phone, and this, says Goldsmith, is one area where construction leads the way. "The mobile phone had a big impact on the jobbing builder, and I guess they will be early adopters of mobile commerce technology as well."

The technology is still evolving, but Goldsmith is sure WAP will encourage construction managers on to the web once it improves. "WAP is not up to much at the moment, it doesn't download quickly enough. But as the next generation is developed, increasing download speeds with easier to read screens, the construction industry will start using the internet more."

Despite playing down the effects of the internet, Goldsmith has been busy developing Travis Perkins' online services. He claims it was the first builders merchant to start trading online and has been trading on the web for more than a year. In the past six months it has seen a big take up of its online services. Registrations have increased 60% and there are currently more than 25 000 users of the site.

Cutting down on paperwork is said to be the chief advantage of IT and the internet, and Travis Perkins is doing its bit to slash administration costs. Account holders can have an automated link between their procurement system and Travis Perkins' order-taking process, so orders only have to be keyed in once. There is no charge to use this service, setting-up costs are minimal and customers are not tied into using Travis Perkins exclusively.

Haven’t we heard about paperless trading before?

Electronic data interchange or EDI was touted as the next big thing to change our working lives when it burst on to the scene in the late 1980s. EDI, the forerunner to XML, the language of the internet, meant it was possible for the first time to exchange information electronically between different IT systems, down the telephone line. This revolutionary method of exchanging information promised an end to paperwork. Or so it was thought. The internet has been spoken about in similar terms and is now overtaking EDI as the preferred method of exchanging information electronically. The big difference is that EDI was a connection between two systems. With the internet, everyone in the world can join in. Set-up costs are cheaper and with the proper security measures, the exchange of information is just as safe. But how do the experts feel? Is there another revolution waiting round the corner to overtake the internet or is this as good as it gets? Derek Blundell, IT director at contractor Ballast, says it has never used EDI, although it is still used in construction. “It is useful for static partners talking directly to one another, but the feeling is that EDI will disappear in light of XML and the web. Who knows, something may replace XML in time.” Ian Goldsmith of Travis Perkins feels there is still a place for EDI, despite the advantages of the internet. “We use EDI extensively and will continue to do so. The web-based systems will allow smaller customers and suppliers to take advantage of the cost savings produced by the electronic processes. The internet has a lower investment cost than EDI, but the end result is similar,” he says.

Builders merchants on the web: the big three

Travis Perkins has been trading online for a year. There are 20 000 products in the online catalogue, some with intelligent information, which means you can take the object out of the catalogue and put it into drawings. The object contains very detailed technical information. The site is linked to the Construction Plus Construction Intelligence tool, which you can use to search for a product and then buy it directly from Travis Perkins. You can log on to the TP site through a WAP phone and do a postcode search to find the nearest branch. It will also give you directions to the shop. You have to be an account holder to use the site, but you can apply online.
www.travisperkins.co.uk The Builder Centre website is the builders merchant arm of materials giant Wolseley. It has been trading online since July, and has 170 000 objects in its online catalogue. Some are intelligent objects with detailed technical information. The site is not WAP-enabled, but like Travis Perkins, does link with the Construction Plus portal. You have to be an account holder to use the site, and it can give you information on what’s in stock in your local branch.
www.builderbulk.co.uk Jewson has two websites for online trading. One is Jewson Direct for the general public; the other, Jewson, is for trade enquiries. To use this site you must be an account holder. Jewson has been trading online since September, although it has recently signed a deal to link up with merchant the Graham Group, which has been trading online for 18 months. There are 150 000 items in the Jewson online catalogue, which does not contain intelligent objects as yet. The site is not WAP-enabled, but you can check your account online, do price and stock enquiries and invoice retrieval.
www.jewson.co.uk

Source

Construction Manager