(Nasdaq: CMDX) brings buyers and sellers of life sciences materials and equipment
together in a specialized marketplace that offers everything from O-rings to
living organisms. Chemdex has announced MarketLink, system that integrates Chemdex'
marketplace with corporate ERP systems and other third party purchasing systems.
According to the company, MarketLink will "provide connectivity and integration
throughout the purchasing process from requisition generation to order submission,
invoicing and payment." In an independent announcement, Chemdex and IBM revealed
that IBM Global Services will be the systems integrator of choice for Chemdex
Although vertical marketplaces have been thought of as a breed apart, their
members have the same needs as other companies. They too have back-end financial
and ERP systems that want to be fed data in the right form, and need to purchase
the same MRO supplies as everyone else. In what appears to be a wholesale adoption
of XML as a document delivery mechanism, Chemdex is redefining the expectations
for vertical marketplaces by satisfying both of these needs. The ability to
interface to corporate backend systems will be a significant cost saver for
the members of the Chemdex marketplace. Partnering with third-party purchasing
solution vendors Ariba and Concur probably benefits those companies more than
it does Chemdex. All Chemdex users are potential customers for the less specialized
product lines offered by Ariba and Concur, while relatively few transactions
are likely to go the other way. Even so, with 75 percent of Chemdex revenues
($11 million in the nine months ending in September 1999, with $8 million from
the last quarter) derived from only four customers, relatively small additions
to the Chemdex customer base could be highly significant to the company.