Success Stories

Activant Trading Partner Connect Helps Manufacturer Cut Costs and Streamline Relationships with Distributors

Tom Haag, president of the carbide metalworking tool manufacturer SGS Tool Company, remembers how he processed orders less than 20 years ago, when he began his career in the company's customer service department. "We took our POs and typed out notices in triplicate that we used as packing lists, invoicing slips, and for our shipping records. It was a pretty laborious process, but at the time, it was considered the best way to do it," he remembers.

Worst of all, the carbon paper between the layers of yellow, pink, and green sheets of paper were not exactly neat. "By the end of the day, your hands would be covered with black ink," Haag laughs.

Now, thanks to technology like Activant Trading Partner Connect, the days of carbon-layered triplicate sheets are over. Trading Partner Connect, an Internet trading network, streamlines the commerce process between distributors, manufacturers/suppliers, and end-users, thereby increasing sales and improving customer service while reducing operating costs. For manufacturers like SGS Tool, the network is a time- and money- saving tool and a manufacturer-distributor relationship enhancer, as well as a portal into the future.

Increasingly Competitive

Haag attests that the metalworking industry has become increasingly competitive, as manufacturers continually move offshore in search of cheaper labor. To battle overseas competition, Haag has realized that he, too, must cut costs. Refusing to move operations out of his home state of Ohio, and dismissing the possibility of using cheaper materials to manufacture his end products, Haag has instead turned to tools like Trading Partner Connect.

"To reduce costs, we must process transactions electronically," Haag contends. "It's one of the only ways we can work with our distributors to decrease costs, without decreasing the quality of our products."

Conducting transactions through Trading Partner Connect reduces SGS Tools' costs in many ways, Haag says. For example, "fat fingers" errors have declined because no one must re-key the orders that come in through the Internet trading network. "Just one small slip or transaction error can cost a couple hundred bucks by the time everything is corrected," he contends.

After less than six months on the network, about 7 percent of the company's domestic orders are processed electronically through Trading Partner Connect, a number that is steadily increasing.

Plus, offering customers the ability to seamlessly send and receive electronic business documents from orders to electronic funds transfers through Trading Partner Connect gives Haag and his staff the confidence to market to new, high-technology customers. "Trading Partner Connect is an easy entree into electronic transactions," he says. "The process is friction-free and economical, and it puts us on a different tier than many other manufacturers."

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