Study: European B2B Activity To Account For 33% Of Sales By 2005

By John S. McClenahen Depending on which industry in Europe a company is in, their online B2B activity could account for one-third of total sales four years from now. A top "European 100" transportation company, for example, could generate 6.5 billion euros worth of business (US$5.53 billion at the current exchange rate), 33% of its total take, in the year 2005, figures Cambridge, Mass.-based Forrester Research Inc. But the prospect of much greater B2B activity is only a possibility. For example, Forrester says European firms will have to make an initial investment of 11 million euros -- US$9.35 million -- to support what's dubbed sell-side commerce. "With too many internal islands of applications to access for online trade, European firms are failing to deliver because features galore don't generate business, poor access to [applications] results in an inability to transact, and crippling maintenance nightmares deliver stale information," states a critical Charles Homs, a Forrester senior analyst. "The cost of integrating the plethora of applications will eat up half the IT investment in the first year," he calculates. And "once the technical infrastructure and [applications] are functioning, the workforce necessary to maintain online sales will soar -- for instance, just keeping the site up-to-date will account for 51% of the ongoing budget," says Homs.

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