Buying On The Web
Ameriquest offers patented purchasing.
JOHN BENDEL
TECHNOLOGY EDITOR
A New Jersey-based leasing company has morphed into a unique buying cooperative that also provides a free web-based community for fleet management professionals.
Ameriquest of Cherry Hill, N.J., is the company. FleetXchange (at www.fleetxchange.com) is the web portal originally launched in 2000. Since then it has become a popular site for fleet managers.
In August of last year Ameriquest launched a companion site called Food FleetXchange — for fleets in food distribution. Now Ameriquest has launched a third site. On May 1st, Ameriquest introduced Carrier FleetXchange, aimed at commercial trucking fleets.
All three sites are open to qualified fleet professionals for free, though registration is required. According to Ameriquest, registered users represent as many as 700,000 power units.
The original FleetXchange is a general site for all fleets. Food FleetXchange and Carrier FleetXchange offer material of particular interest to fleets in those defined areas.
All three FleetXchanges contain common elements, including forums for discussion of fleet management issues and reviews of many products.
Another common element is a low-key introduction to the buying services of Ameriquest.
FROM LEASING TO PURCHASING
The company began its evolution from truck lessor to national buying service almost five years ago when it brought together other independent leasing companies for group buying power.
"Savings of anywhere between 10 and 25 percent depending on the product line are not unusual on procurement. It's the aggregated volume purchasing we bring to the party and the ability to take cost out of the process itself,'' said Joe Ciolino, vp sales & marketing.
The company established partnerships with fleet suppliers such as Citgo, Yale Lift Trucks, Bandag Tires, Allison Transmission, Sterling Truck Corp., Continental General Tires, Freightliner, Morgan Corp., Cummins and GMC among others. Ciolino said approximately half of all independent leasing companies in North America purchase through Ameriquest.
With a secure leasing base, the company began looking for member fleets beyond the leasing community.
"Two years ago, Ameriquest began a partnership with Food Distributors International for procurement services. It was really our first entree outside of the truck leasing and rental sector,'' Ciolino said.
Food Distributors International is an organization of "wholesale grocers and some food service entities,'' he explained.
Since then, two other food-oriented groups have joined — the National Grocers Association and the American Wholesale Marketers Association.
Ameriquest's latest initiative, which has actually been quietly underway for some time, seeks to bring the even larger commercial trucking community into the patented Ameriquest system.
What's so unique about buying through Ameriquest?
"It's not a franchise system and it's not an association. What we have is independent leasing companies that have protected territories throughout North America for national sales contractual issues, long term contracts such as dedicated contract carriage, full service leasing and things of that nature,'' Ciolino explained.
"Our procurement process is exactly that, it's a process. It's not a transactional-type system. We have to credit-approve each entity that registers. They must have a minimum of 50 power units in order to qualify. And they take advantage of the aggregated volume we've already established through our relationship within the leasing and rental industry.''
According to Ciolino, fleets that use Ameriquest can continue to do business with their current suppliers.
"Theoretically, nothing changes in the way they do business today. The only difference is that credit issues and payments run through Ameriquest,'' he said.
OLD SUPPLIERS STAY ON
Ameriquest asks approved member fleets for a list of current suppliers. The company then notifies each supplier's corporate parent or franchiser.
According to Ciolino, corporate notifies each dealer that the fleet will henceforth be charged by Ameriquest pricing matrixes. "The process automatically takes over from that point forward,'' he said.
"Services will get billed through the Ameriquest e-commerce system, but they still have the same relationship with that local Johnny's Tires that they always had before. Nothing changes. We do not dis-intermediate the relationship whatsoever.''
But if nothing changes, where do the savings come from?
"When you look at what it takes a transportation manager or procurement manager to procure product, there's a lot of cost in that process. On the other side of the ledger there's a lot of cost the supplier has to incur under a normal paper-type process,'' Ciolino explained.
"What we've done is taken a lot of the cost out. A supplier may have 75 or 100 accounts out there that are all negotiating separately. They all have their own invoicing and so forth. They may have different credit terms. The credit risk may be varied.
"The suppliers know that with Ameriquest we're credit responsible. So the dealers in most cases get paid faster, within 48 hours. And we're responsible for all indebtedness for all those individual 7,500 accounts or so. And all those transactions are done paperlessly, so the amount of the administrative savings suppliers realize is enhanced tremendously,'' Ciolino said.
"Let's say for example that ABC Trucking Company or Food Service Company has a relationship with Johnny's Tires. Nothing changes. He still picks up the phone and says, "I need 10 new tires and I need 'em by 2 o'clock this afternoon.' They deliver those 10 tires. A delivery receipt is signed and the moment that delivery receipt is signed, the entire process becomes a paperless process, automatically.''
Ciolino said that the process works best with local dealers for national companies with whom Ameriquest already has a buying relationship, but that individual dealers may have the right to opt out of a deal.
"If they wanted to they would,'' Ciolino said. "In most cases I don't think they see much variance. I don't know of any that have (dropped out) in the years that we've been doing this.''
According to Ciolino, the entire buying process is so unique that it recently earned a U.S. patent.
PORTAL ATTRACTS FLEETS
The Internet plays a critical role for Ameriquest.
"It's a communications tool that facilitates the process. The e-commerce system itself that's behind the firewalls on each respective portal is blocked by a closed community environment with secret passwords,'' said Ciolino.
But Ameriquest also uses the Internet as a marketing tool.
Jim Webster, Ameriquest vp, said the FleetXchange web sites help bring Ameriquest to the attention of fleets large enough to be members, but too small to support individual sales efforts.
"We're going to go out to the national businesses on a one-to-one basis. But the smaller guys? We can't afford to call on them so we need to develop some way for them to call on us. And that's the concept of FleetXchange,'' Webster said.
"It's a web presence. It has a knowledge element to it, basically forums and threads that tie maintenance guys together for all kinds of trucking.
"Right now you have a FleetXchange umbrella. And then you have the Food FleetXchange for people who are members of specific organizations. Carrier FleetXchange will be the second vertical.
"There will be more that is general than is specific because a truck is a truck. But there are things we'll pick up regarding, say, legislation that have to do with common carriers but nothing to do with private carriers. Its content, its direction and its look will be focussed on the carrier and his issues and also procurement programs for carriers.''
Ameriquest, Webster said, is "an emerging force in this industry.''
Sidebar
Surfing Fleetxchange
