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Vamedis: Bringing the Old World into the New Economy

Executive Summary

Just when you thought the party's over in Internet-enabled e-commerce, Vamedis is staking a claim for leadership in Europe's B2B supply chain space. Over the past year, the European marketplace hasn't been much friendlier to dot-coms, particularly B2Bs, than the US marketplace has been. But far from a venture-backed start-up, Vamedis is banking on leveraging the entrenched market positions of seven of Europe's leading hospital supply companies.

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Cardinal.com: The New Old Thing

Often overlooked in the debate over who's going to win the Internet wars, Cardinal makes its case for a distributor-driven model. A single place to purchase drugs and med/surg supplies, do remote order entry, and more efficiently process information, Cardinal.com builds off of traditional EDI programs. Like many e-commerce plays, Cardinal.com recognizes the value of an open system and the ability to work with as wide a variety of sites as the customer wants. But company officials make a distinction between a stance of openness and neutrality. In the process, Cardinal is trying to make the argument that rather than being disintermediated by the new B2B players, distribution-based models may ultimately prove the most robust and sustainable because of distributors' history of supply chain management.

E-Health's Second Mover Advantage

The revolution that the Internet is bringing to hospital supply is really two revolutions, one transaction-oriented, the other information-based. MedAssets hopes to capitalize on opportunities in the transaction-based realm by, in effect, applying Internet technology to two relatively traditional service businesses, group purchasing, and capital equipment refurbishing and resale. MedChannel, by contrast, is trying to create an infochannel that promotes wide efficiencies across a broadly defined supply chain, from OEM to end user. Both companies face a challenge: that of coming late to a B2B e-commerce market that is evolving rapidly. Their hope: a kind of "Second Mover Advantage", under which the early B2B leaders open doors to customers that both companies can more easily walk through.

E-Health's Execution Play

Combining the benefits of a disciplined hospital system and a leader in e-commerce, the new joint venture between Tenet and Chemdex hopes to create a differentiated offering in e-health. The new company has the ability to integrate the hospitals and suppliers Tenet/BuyPower represents, thus providing the critical mass that e-commerce companies have, until now, lacked. But company officials insist that their real advantage is that they offer a different approach to e-commerce, one that focuses on an end-to-end solution tied to the hospital's ERP system, rather than simply a web site to make ordering and inventory management more efficient.

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