Creating ALEO.com, Poland's First B2B Auction Platform

ALEO.com

Developing a platform that allows companies to simplify procurement and lower expenses

02 Jan 2017

ALEO.com is the first trading and auction platform in Poland which enables registered companies to buy and offer their products.

Through this platform, active users improve their procurement process, reduce costs and use many business facilities which have only been available offline thus far. Functions that were made available in 2013 are all free of charge.

Client
ING Bank Śląski

 

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The advantages of ALEO.com

Purchases

  • Electronic purchase process (offer inquiries and tenders)
  • Price negotiation via purchase auctions
  • Development of offer inquiries
  • Comparison of offers

Sale

  • Product and service offers in the form of catalogues
  • Establishment of an own B2B shop to flexibly manage price lists offered to the existing and future business partners
  • For certain offers, sales auctions useful in price negotiation

Networking

  • Establishment of new commercial relations with partners verified by ALEO.com
  • Development of a business partner network
  • Evaluation of transactions
  • Development of the company’s reputation in the platform

Unique project on a world scale

It is difficult to compare ALEO.com with any other e-commerce platforms in the world, as it combines various functions and operates on the B2B market, which is less active in the Internet. ALEO.com has no 1:1 equivalent. It was therefore not possible to refer to a specific business pattern or model. There are, of course, B2B auction sites which have succeeded, such as Chinese Alibaba, however their dynamic development is more so connected with the specific nature of a given market than with the extent of their offer. ALEO.com’s unique characteristic is the consolidation of various commercial and banking processes within one platform.

"No one has carried out such a project before. Thus, we could not check how a similar platform operates and which platform model will succeed. We developed the entire platform concept and architecture from scratch".

Grzegorz Ścisło

Board Member

e-point S.A.

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How did we come to the challenge the Grupa ING offered us?

  • ALEO.com - Concept

    Undeveloped niche

    Studies conducted by ING show that only 16 percent of Polish companies sell online and only a fraction of them sell in the B2B segment. At the same time, respondents informed that they would like to use new commercial exchange platforms, which is reflected by a large percentage of entrepreneurs that use Internet shops for private purposes (75 percent at shops and 68 percent at auctions). The ING Group decided that the potential of this niche may be developed if corporate customers are offered a simple and effective tool. At the beginning, there were no specific assumptions for processes to be included, but only a general goal to establish a trading platform which will enable companies to cooperate and reduce a related trading risk.

    Added value for business

    The trading and auction platform must develop a relevant user base to become attractive. It was necessary to define functions that would make registration profitable not only for ING customers. For this reason, e-point took on the role of bank adversary in the discussion and asked Why would we register in the site as a company? Customers usually mentioned the inability to find and compare business partners efficiently in the Internet as online purchase barriers.

    Enterprises would like to get to know other companies from their own and other sectors and look for products they are interested in based on their needs. Thus, the first platform channel comprises procurement processes, including offer inquiries, offer comparisons and purchase auctions.

    Added value for ING customers

    The ING Group’s strategic goals to create added value for its corporate customers, was the basis of the project. Although the platform is open to all entities, ING customers will earn the largest benefits. From their point of view, registration is simpler and the company is not subject to verification. In addition, ALEO.com will provide access to dedicated banking products: reversed factoring, safe payments AleoPay, free transfers to business partners in ALEO.com, and simplified Internet transfers in the future.

    "This aspect of the platform was an additional challenge for us since we had to integrate the platform with bank systems to maintain SSO standards and implement AleoPay" - says Grzegorz Ścisło from e-point.

  • ALEO.com - Functionality

    Offer inquiries

    The first elements of a trading and auction platform are groups of modules to be used to generate offer inquiries. To achieve this, a unique configuration tool where enterprises define detailed features of a product or service in a dozen steps to obtain offers only corresponding to their requirements was developed. The configuration tool enables predefined feature sets to be used and define new unique characteristics for a given sector. Having collected offers from the market, a company may compare them with the use of a special tool which creates offer tables and no spreadsheet comparisons have to be developed.

    Purchase auctions

    If none of the offers are satisfactory, a purchase auction may be opened. Contrary to consumer auction sites, the major purpose of the auction is to reduce the price: a company that offers the smallest price for the clearly described product will win. This is the most efficient negotiation method used mainly by large corporations. Small and medium sized enterprises registered with ALEO.com published data which reflect savings of 3, even up to 60 percent (Sarens Polska), which translates into hundreds of thousands PLN. The platform also enables auction moderation to eliminate dumping methods.

    Internet shops

    At ALEO.com, both smaller and larger enterprises may create their product catalogues without the cost connected with domain infrastructure and maintenance. As an additional advantage, the catalogue is automatically supplemented with products when a supplier makes changes. In the future, the platform will be expanded with information about warehouse stock in the product catalogue. Ultimately, the platform will incorporate “the shop of all shops” which will be superior to particular companies, similarly to “the boss of all bosses”.

    See spots under “the boss of all bosses” campaign

    An advantage is that catalogues may be supplemented with products and updated automatically when any changes take place. In the future, the platform will be expanded with an option that will enable to present warehouse stock in the Product Catalogue.

    Sales auctions

    An interesting alternative to the product catalogue is the sales auctions option.The rule is similar to retail platforms. The difference is that on the B2B site, they will be successful in the case of offers that are unique or exceptionally priced, as the sale of wind turbines.

    Networking

    ALEO.com is also a social site which enables you develop a network of partners verified by ING. ING will verify only generally available data (address, VAT No. (NIP), statistical ID (Regon)) for a nominal fee of PLN 1.00 to be transferred from the business account. Completed transactions may be evaluated to develop the reputation of other companies.

    Innovative supplier financing module

    As part of the corporate platform, ING Bank offers reverse factoring, which is an innovative service on the Polish market. This is a commercial transaction which enables suppliers to receive almost immediate payment for products or services provided and recipients to pay invoices within a convenient later time period. Contrary to traditional factoring, reverse factoring is much safer and customer-friendly.

    The information architecture and navigation were designed in accordance with the following motto: “less means more” in order to involve a user in business processes and present information in a legible manner. Key service information is aggregated in two dashboards dedicated to a recipient and a supplier. They form an entrance point for users: they inform that certain actions must be taken and they refer to detailed information about invoices, business relations and reports. Factoring is based on invoices which take on about twenty different forms. For simplification purposes, invoices are presented in a unique manner so that users can conveniently trace their circulation.

    There were many design challenges related to the supplier financing module. Apart from advanced integration with customer systems, it was mainly necessary to develop a friendly and legible user interface which had to enable enterprises to go through and understand nontrivial business processes without effort. After several months of work in the Scrum methodology, the customer managed to develop a solution together with the e-point team. The effect of their joint work brought about lot of satisfaction and was highly appreciated by the customer.

  • ALEO.com - Optimisation

    Business risk reduction

    Apart from the basic verification of platform participants, ALEO.com provides a number of functions aimed at the reduction of risks related to e-commerce transactions. The main function is AleoPay. This is a dedicated payment form offered via the ING Bank Śląski Internet banking system (only for its own customers). It is based on a principal similar to escrow accounts. If a transaction is made between two ALEO.com users, the bank acts as a financial agent that informs the supplier that an amount due for a product or service has been paid and releases the funds only after the recipient confirms receipt of the goods. The process designed by us is simple and, from the point of view of business partners, looks like an ordinary domestic transfer. In addition, to improve the company’s reliability, a financial rating given by the bank on the basis of the company’s financial statements, which may be sent voluntarily, may be published in the platform.

    Open project

    We are still working to develop ALEO.com in order to find a model that will be most attractive to users. We will successively implement new functions corresponding to our customers’ business needs connected with their everyday operations and bank services, e.g. payment mechanisms based on the bank’s infrastructure and ING’s Internet service systems for business entities.

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