Tech2B: the new marketplace for technical parts of manufacturing machinery

About Tech2B

Most people don’t realize how equipment that is capable of making everyday products is actually made. But for every part of e.g. a coffee machine or even when it comes to making a simple can that you drink cola from, machinery is indispensable. These machines are made up of parts and sometimes they break down. Or new machinery has to be built which, of course, needs parts.

Suppliers that make these parts are often highly specialized and not that big, says Paul Wouters. He founded the company Tech2B together with his brother Dirk and IT expert Sjors Hooijen. In total there are as many as 60,000 such manufacturers in the Netherlands, according to Wouters. Of those, 27,000 are specialized in making steel parts of machines. Of these, 26,000 are SMEs with less than one hundred employees in each company.

All those companies have to process orders and often they do so by filling in a form on the web portal of their company. They then process the purchase and sale via emails. A laborious process as your name, address, amounts, drawings, parts, and so on all have to be added to the computer system with each new order. Wouters’ brother, Dirk Wouters, had to deal with this as the owner of a company in Bladel, the Netherlands, where all three founders of Tech2B hail from. He asked Hooijen to help him come up with a solution in order to avoid unnecessary hassles.

The end of tedious chores

The result is impressive. The platform of Tech2B works a bit like e-Bay or the Dutch equivalent Marktplaats. A buyer or seller of a company places an order whereby they offer or request a product. Buyers and sellers from the manufacturing industry connected to the platform are able to respond to that. 

All the users of the platform have registered themselves. If a buyer purchases a product via the platform, the platform issues the invoice and this also appears on the screen of the person doing business via the platform. Administrative chores are solved quickly this way. Doing business is quick and transparent. If a company uses Tech2B for its standard purchases and sales, there is no risk of coming across any administrative records on an employee’s PC that no one else has access to. If all employees use Tech2B, a company gains a good overview of the purchasing and sales processes without this requiring a lot of work or time.

300 affiliated companies

According to Wouters, around 300 companies are affiliated right now. Most of them are in the Eindhoven region. “Initially, our aim was to integrate the chain of suppliers with the Dutch manufacturing industry. An ERP system is too expensive for most companies.” This is a system that companies use to regulate and automate their business processes. Tech2B is therefore a godsend for SMEs in the manufacturing industry.

As soon as Tech2B went live, the platform ran like clockwork. Not surprising, in the first place because there was a need for it and Wouters’ brother Dirk’s company wasn’t the only one that wanted to do away with the administrative hassle of handling minor paperwork and the chore of sending invoices manually by e-mail. Secondly, because participation in the platform has been free so far. This means that no revenue has been generated as yet. “But that is set to change next year,” Wouters says. ” We said at the outset that companies could use the platform for free for the first year.”

Charging fees from 2021 onward

The intention is that companies will pay as of January 2021 onward. “We are going to undercut the price of conventional ERP systems on the market. We want to offer three packages. One that is free with relatively few services. You can then see what is being requested by buyers and what is being offered by sellers. A second package will cost around €70 or €80 per month. This is suitable for small businesses. A third package is expected to cost €199 per month. Several employees or departments can make use of this. Which is suitable for large companies such as VDL, Wouters explains.

VDL is already a subscriber to Tech2B. This company, which produces all kinds of machinery, including buses, amongst other things, relies a lot on local suppliers in the area.

Any competition?

There does not seem to be much competition in this particular area at present. There is a company in Austria, called OrderFox, and a company in Germany called TechPilot. “The difference is that they offer nothing more than what the marketplace is already offering: an ad to buy or sell a product. You have to handle everything else yourself via e-mail or phone.” Then you still have the same administrative hassle as before.

An additional potential threat is if a software manufacturer develops an ERP system for the manufacturing industry. Yet the chance that this will be more expensive is very realistic – one of the reasons that SMEs do not buy these types of systems at the moment. An advantage of Tech2B for manufacturing suppliers in the regional market is that they all use the same system. “If everyone uses different, stand-alone ERP systems, that still wouldn’t be handy.”