OTN eyes move into the UAE

Alan Livingston, CEO of OmanTradaNet (OTN), aims to bring OTN's B2B trading system into the UAE market in the coming months.

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By  David Ingham Published  June 13, 2002

OmanTradaNet (OTN), an Oman-based e-commerce company, is mulling a move into the UAE market in the coming months. The company is currently meeting with potential business partners and users about the possibility of bringing OTN’s business to business electronic trading system into the country.

However, rather than another potential rival to existing public e-marketplaces, OTN's system functions more like EDI, connecting large trading partners and their suppliers directly.

“In order to work, e-marketplaces require participation,” says Alan Livingston, OTN's CEO. "Our system encourages the participation of smaller players, which is vital for an e-market to work."

OTN's strategy, which will be replicated in the UAE, is to identify ‘hubs’, major private or government entities that carry out large amounts of procurement. Once these hubs, of which Livingston says there are around fifteen in Oman, are signed up to OTN, their suppliers, mostly small to medium businesses, tend to follow.

However, participating companies do not buy and sell in a virtual market according to the classic e-marketplace model. Instead, the hub will send out a request for quotation (RFQ) form to the OTN system, which then routes the RFQ directly into the supplier’s ERP system or to a secured Web site. The supplier can then enter their quote into the electronic RFQ and return it to the customer.

Think of it as old fashioned, expensive EDI (electronic document interchange) on today’s low cost internet. “EDI is thirty years old; now we’re making that process available to anybody,” says Livingston.

Membership of OmanTradaNet is free and a fee of up to OR1.3 (around Dhs/SR13) is charged for each transaction, the price depending on the volume of transactions conducted. A cost is also involved in connecting a company’s IT system to OmanTradaNet.

Livingston expects that frequent users of the system will spend around $15 per transaction, rather than $40 or more to do a transaction manually.

The company, whose key backer is Oman’s Zawawi group, is eyeing an autumn launch in the UAE, possibly under the name UAETradaNet and probably in partnership with a UAE company. “We’ve identified key hubs and it’s clear there is a requirement for what we are offering,” says Livingston.

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