TradePower links contractors to distributors

April 1, 2001
The electrical industry has seen many dot-coms come and go over the past year, but it hasn't seen a company marketing e-business services that has quite the same focus and electrical pedigree as TradePower, Linthicum Heights, Md. The company has one foot firmly planted in the contractor business with its Estimation estimating software division and its recent acquisition of Trade Service Systems, Blue

The electrical industry has seen many dot-coms come and go over the past year, but it hasn't seen a company marketing e-business services that has quite the same focus and electrical pedigree as TradePower, Linthicum Heights, Md. The company has one foot firmly planted in the contractor business with its Estimation estimating software division and its recent acquisition of Trade Service Systems, Blue Bell, Pa., the largest supplier of distributor business software. TradePower's emerging digital marketplace links electrical contractors' estimating and procurement processes directly to the business systems of their suppliers.

Users of Estimation software can link to suppliers in the TradePower system through a suite of software:

PowerPack

This software is designed to offer contractors instant price and availability comparisons among multiple suppliers, and allows them to purchase materials directly from the supplier of their choice.

PowerStation

This online tool enables transactions among contractors and suppliers, including a suite of collaboration tools, all through a user-friendly Web interface. The company also offers access through wireless devices in its PowerTool product.

Probably the most important feature of the system is the fact that both systems use the same product database, making electronic translation much easier. Estimation uses the Traser pricing and product database published by San Diego, Calif.-based Trade Service Corp., which was the sister company of Trade Service Systems for many years. The product database produced by Trade Service is also compatible with Trade Service Systems business software for electrical distributors. Mike Wentz, vice president of sales for TradePower, said that's the key to the making the systems work together seamlessly.

“That's the key, the golden ring,” he said. “It has the UPC code that allows us to communicate with the distributor system.”

The acquisition benefits electrical contractors' suppliers who are on Trade Service Systems software because it will give them access to thousands of contractors currently using Estimation and other TradePower products, as well as the industrial MRO customers that the company expects will use the digital marketplace to streamline their procurement processes.

TradePower acquired Estimation last year and has been working closely with Trade Service Systems since that time to integrate the two business systems.

Tom McVeigh, chief executive officer of TradePower, said the companies' existing staffs will remain in place and that once the acquisition is completed, the company may be reorganized into three different business units: the supply side for its distributor software business, a demand side serving electrical contractors and a unit that manages the technology in the digital marketplace that connects these two business units.

“A lot of the magic happens in that digital marketplace,” he said. “We have been working for well over a year in integrating the software for the contractors and distributors on the sell side.”

McVeigh added that TradePower will also be getting more involved with the MRO and industrial markets in the future.

Mike Wentz and McVeigh agreed that the synergies between the two companies became obvious as they discussed their e-business strategies.

“Shortly after launching TradePower, it became very obvious that it would be much better for us if we could bring both software companies directly into the fold so that we could take maximum advantage of the synergies and coordinate all of the product development and marketing activities together,” McVeigh said.

He added that Trade Power's sales force will sell the entire package of software solutions, but will be supplemented by product specialists who focus on either the products for electrical contractors or software for electrical distributors.

Boston Ventures will continue to be a major shareholder in TradePower. Trade Service Corp. is now owned by i2 Technologies, Dallas, but it has a long-term agreement with TradePower to continue supplying the company with its electronic database of electrical products.

“It is really coming together,” McVeigh said. “The story had always been a little awkward, because on one hand we owned Estimation, but we only had a joint venture relationship with Trade Service Systems. This acquisition really makes the story so much cleaner for us. The technology is now part of TradePower. We have the technical pieces on the demand side and supply side.”

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