TAMPA, Fla. -- Dexsi.com, an electronic business-to-business trading platform operated by Digital Exchange Systems here, is attracting the interest of grocery companies with its ability to save costs in the procurement of grocery and health and beauty care products.
"We're saving 20% to 30%," said a category manager with a large New Jersey-based wholesaler who chose to remain anonymous. His company handles over $1 billion in total volume and ships along the mid-Atlantic from Connecticut to Maryland. This cost savings, the primary reason the wholesaler became a member recently, is a result of direct buying, which has resulted in fewer transactions in the procurement process.
Currently doing about 10% of total procurement on the site, he expects to increase the amount of buying he does on the exchange, as Dexsi, which plans to expand to other categories, grows larger.
Dexsi also provides members -- referred to by the exchange as "qualified industry participants" -- the option to sell but the official at the New Jersey wholesaler does less selling than buying there, he said. However, "I do put overstocks on there and get better prices than I would from a salvage guy."
The fact that all participants in the exchange are anonymous from start to finish of every transaction does not matter to the New Jersey wholesaler.
"What matters is that [product] is coming from a reliable source. We have checkers," he added, "so if there are item problems, we can just refuse it at the door." Both buyers and sellers are carefully screened by Dexsi when they join in an effort to prevent illegitimate bids, the company said.
The wholesaler also cited as a benefit a software package provided by Dexsi that assists in inventory management and searching on Dexsi.com. The application, known as "front-end" software, interfaces between the member's computers and the exchange. Based on preferences set by a member, the software tracks that member's inventory, then looks for specific items when that member logs on. If a member is running low on Quaker Oats, for example, the software will know that and look for the best deal on Quaker Oats when the member logs on.
With this application, "you don't have to hunt and peck for an item," the wholesaler said. Also, "it's a great way to gauge what the marketplace is doing. You can see items and their prices; you know the nature of pricing."
Dexsi also provides other services such as shipping via a brokered trucking service, warehousing in its own million-plus-square-foot facility in Edison, N.J., and financing on items. Due to the anonymous nature of Dexsi trading, paperwork associated with any order is provided by the exchange itself, with blind copies going to the trucking company and to the receiving company.
Generally, smaller members of the exchange opt to use these full logistics, according to the Dexsi. Any shipping and/or finance costs are added to the minimum bid on an item, according to Dexsi President and Chief Executive Officer Rob Newton, who added that pallet charges for companies using the exchange's warehousing services are billed monthly.