Sears and Carrefour form online marketplace with Oracle

Sears Roebuck and French retailer Carrefour are joining forces with Oracle to create a multimillion dollar virtual marketplace to support their online supply chain trading schemes.

To be called GlobalNetXchange, the two retail companies' 50,000 suppliers will be able to buy, sell and auction consumer products through the site. While Oracle will provide the software to build the infrastructure and hold an equity stake in the company.

David Stevenson, retail manager at Oracle UK, claimed the deal could force many suppliers to re-evaluate their internal systems. He said the recent trend towards online trading marketplaces was a paradigm shift in the way retailers conduct business.

"Purchasing sits at the core of the retailing mentality and this will radically change the way retailers go about their day-to-day business. This will have a knock-on effect on the systems that suppliers implement internally. It's easy enough for them to log onto GlobalNetXchange but the implication in terms of how they traditionally do business will create massive upheavals," Stevenson warned. He added: "This is a cultural change that will affect some suppliers adversely."

Doug Duffin, senior retail consultant at Cap Gemini, said: "This deal is about more than money and speed of business. It is a means of reducing internal costs and will provide a better platform for sharing information. But more importantly, it is about economies of scale and opening a global marketplace where companies can buy and sell regardless of geography."

However, Brian Pearce, senior consultant at IDC, warned that suppliers who are slow to go online could left behind.

"Carrefour and Sears are likely to have had discussions with the more important suppliers before hand but in the short term there could be problems. The smallest suppliers might take longer to go online and their big customers - like Sears or Carrefour - might look elsewhere. So, if they don't keep up then they might be dropped."