Covisint LLC is getting out of the electronic catalog business. Reverse auctions could be next to go.
The catalog was one of Covisint's first offerings after the industry exchange began operating in 2000. But Covisint is examining all of its software applications to determine whether a third party could do it better - or whether the service is needed.
The company wants to focus on a messaging service that will streamline the exchange of electronic documents between suppliers and automakers. The service, called Covisint Connect, will be introduced next month.
Covisint said it will stop offering its electronic catalog before the year ends. About 470 suppliers use the service to post their electronic catalogs of products, mostly office supplies and other indirect materials.
Automakers looking for supplies can click through the electronic catalogs and order supplies online, rather than thumb through thick, paper catalogs. They still will be able to do that - but not in one central location through Covisint.
Covisint's reverse-auction tool may be the next to go, according to Paul Manns, the Southfield, Mich., company's marketing director.
The tool has been criticized by suppliers who view it as a way for automakers to squeeze price cuts out of them.
Since Bob Paul replaced Bruce Swift as Covisint's chief executive officer in June, the company has been focused on the messaging service.
``Part of doing that is to undo ourselves from the application areas of the business, and catalog is one of those areas,'' Manns said. ``It was always kind of marginal.''
Suppliers and automakers long have relied on electronic data interchange to exchange critical information such as a material release - a production forecast that an automaker sends to a supplier.
Covisint said that by streamlining the way suppliers and automakers send and receive electronic documents, it will become a messaging hub for the industry.