The Transgarant company uses an electronic management system for purchases of NORBIT Business Trade

The transguarantor is one of leaders of the Russian transport market and transport-forwarding service of the enterprises, services of lease of own rolling stock and also operating dispatching control of promotion of cars is engaged in rendering transportation services by railway transport of loads of industrial function, including transportation services of loads in own rolling stock.

The Transgarant company has the branches and representations in 20 cities of Russia and the CIS and performs transportation of goods on 15 of 17 Russian Railways and also on the railroads of the CIS countries.

In the company over 10,800 units, and taking into account subsidiary companies over 12,000 units of the rolling stock which 65% make own cars are operated. The park of the rolling stock of Transgarant company consists of universal cars: the gondola cars covered and platforms, - and also specialized: okatyshevoz, oil petrol, ammoniac and gas tanks, grain carriers, fitting platforms, cement trucks, mineral wagons, refrigerator sections and hopper dosers. The companies are owned by 4 trunk and 7 shunting locomotives.

Average monthly volumes of transportations have a permanent tendency to growth and in 2005 were 1.5 million tons. Revenue of the company according to IFRS in 2005 made 3.7 billion rubles. Monthly the Transguarantor invests more than 7 million US dollars in acquisition and upgrade of the traction and rolling stock.

Key factor of successful development of Transgarant company (at the end of 2005 revenue of the company grew by 19 %) is diversification of productive activity: now in the company about 11 different types of the rolling stock and also active mastering of new segments of the market of transport transportations, such as, of transportation of goods on specialized transport platforms are successfully operated. Providing such market strategy demands from the company of serious investments into acquisition and technology upgrade of the rolling stock – the main production resource of the company. Today the company monthly spends about 7 million dollars for purchase of cars, spare parts and payment of service in repair of vehicles.

For the last year the park of own rolling stock increased by 30 % and made more than 7 thousand units of the transport equipment, and number of the rented machines though was reduced, but now exceeds 3 thousand units. For ensuring reliable operation of the transport equipment in the company own repair services function, and the part of works on technical upgrade of machines is carried out by forces of contract organizations.

As a result of significant growth of volumes of the purchased vehicles and spare parts and also increase in number of different types of the operated machines load of services of logistics of the company in many respects increased. Therefore the operating technology of purchases which was used in the company did not allow to carry out purchases with former efficiency, at the same time the restrictions for work of services MTR imposed also features of the market of the railway transport equipment: limited number of suppliers, their territorial remoteness, various schemes of payment and delivery condition of products. For the purpose of optimization financially of the equipment of the company the guide of the Transguarantor made the decision on need of use of competitive technologies of purchases and process automation of management of supply.

As the instrument of control automation by competitive purchases the management the Transguarantor selected the electronic trade purchasing system of NORBIT Business Trade developed by specialists of NORBIT company using modern Internet technologies. Main advantage of a system were ample opportunities on on-line to vendor interaction of the company and convenient functionality of electronic purchasing auctions.

For a preliminary estimate of expediency of application of electronic auctions in Transgarant company the test electronic auction on purchase of spare parts on NORBIT marketplace which basis is also formed by the NORBIT Business Trade system was held.

Test biddings allowed company management of "Transgarant" to estimate efficiency of use of competitive technologies when purchasing the transport equipment - results of biddings showed decrease in purchase prices of spare parts on average by 9 % of the original price. Specialists of service of supply during trial biddings had an opportunity to check functionality of a system in terms of convenience and efficiency of carrying out working activities on maintaining reference books of the nomenclature, preparation of tenders, formation of analytical reports based on biddings and other.

As a result of test biddings on the platform of NORBIT the company management of "Transgarant" made the final decision on need of system implementation of NORBIT Business Trade as the instrument of automation and management of competitive purchases.

NORBIT Business Trade is a full-fledged management system for trade purchasing activity. Modularity of creation of functionality of NORBIT Business Trade allows to use it and for holding electronic auctions and price monitorings and as the complete solution for supply automation including collecting and requirements analysis in goods and services, qualification selection of suppliers, maintaining the register of agreements and control of their execution and also efficiency analysis of logistics of the company.

In Transgarant company on the basis of standard functionality of the NORBIT Business Trade system the corporate Internet platform is developed for carrying out electronic biddings in real time - http://trade.transgarant.com which is brought into commercial operation since May, 2006.

In addition to holding electronic auctions for the choice of the most profitable price purchase quotation specialists of Service of logistics of Transgarant company maintain in a system a register of suppliers, the register of purchases and the nomenclature reference book of products which is used when forming lots and competitive offers. At the same time one purchase according to the solution of the company can include at once several lots by which winning bidder is determined on the basis of the best price offer.

The built-in technical means of a system allow to carry out also automatic mailing of invitations to participation in biddings (notification) on a supplier list and to receive the reporting under results of electronic monitorings with a binding to dates of auctions, lots, price offers and suppliers.

Information on the taken place and planned auctions is placed on corporate marketplace of the Transguarantor in free access thanks to what all interested suppliers can get acquainted without advance registration with the plan of electronic price monitorings of Transgarant company.

Directly electronic biddings in real time take place already in the closed system zone, access to which the supplier gets after registration on the platform and obtaining the right to participation in biddings. For the purpose of ensuring fair competitive struggle and minimization of probability of collusion between suppliers during the auction only information on the best price offer is available to all participants, data on other bidders for suppliers are closed. At the same time the supplier can repeatedly change the price on each lot of purchase throughout all time of holding the auction.

"One of key, in our opinion, advantages of the NORBIT Business Trade system, in addition to, naturally, economy on purchases, is a possibility of consolidation and ordering of information on trade purchasing activity of the company. Actually thanks to system implementation we received the convenient instrument of market monitoring of products and services and marketing work with suppliers".

Allowed Transgarant company to implement the solution NORBIT Business Trade in the system of supply of the company new modern technologies of purchases that supports now the high level of efficiency of logistics of the company.

Development of corporate marketplace and implementation of functionality of electronic auctions became the solution of a number of the major problems of providing the company with production resources:

• use of competitive technologies at the organization and carrying out purchases of material resources;
  
• expense reduction on purchase of the main production resources – cars, spare parts and services in repair of the rolling stock (10-12 % of economy);
  
• increase in efficiency and quality of vendor interaction;
  
• providing the convenient tool to suppliers for participation in tenders and auctions of the company;
  
• expansion of a circle of potential suppliers of the company;
  
• automation of procedures of preparation and carrying out tenders;
  
• implementation of the convenient instrument of control and efficiency analysis of logistics of the company;
  
• increase in information openness of the company;
  
• holding electronic auctions;
  
• decrease in a subjective factor at decision making about purchase of goods and services.

Now the NORBIT Business Trade system is most fully used in Transgarant company as a part of functionality of electronic auctions, but in the long term systems capabilities can be expanded due to automation of procedures of collecting and requirements analysis in material resources and also maintaining in the system of the register of the contracts signed according to the results of last biddings.

If technologies of competitive biddings will be extended to all nomenclature list of products which are purchased in Transgarant company and also repair and service work on service of the transport equipment, the functionality of the NORBIT Business Trade system on qualification selection of suppliers will be demanded in full. It will allow to allow to participation in biddings only of those suppliers, qualification and which experience conform to the stated requirements.

Ensuring legally significant electronic document management with means of a system is not in the closest plans of the company for development of corporate marketplace yet, but such opportunity can be in case of need easily configured in the NORBIT Business Trade system due to use of EDS technology (electronic digital signature).

"For transport companies which specifics of activity are defined first of all by wide geography of a partner and client network the business applications based on Internet technologies represent absolutely new opportunities for development and business. Use of modern Internet solutions allows to organize most effectively information exchange between all market participants and at the same time to minimize finance costs on ensuring such interaction."

The NORBIT company specializes in information technology field, is a part of LANIT group, the largest Russian system integrator.

In structure of LANIT holding the NORBIT company is Competence Center on development and deployment of the integrated enterprise management systems on the basis of the solutions mySAP Business Suite, Microsoft Dynamics AX (Microsoft Axapta) and MFG/PRO and also customer relationship management systems – Microsoft Dynamics CRM (Microsoft CRM) and mySAP CRM.

The separate direction of the company is made by practice of creation of solutions for electronic business and automation of trade purchasing activity state (State order system) and commercial structures (NORBIT Business Trade system). Among the business companies which are regularly organizing purchases of goods using NORBIT Business Trade technology there are TD "Intersection", JSC Alfa-Bank, Ltd JSC ALROSA, UK "Integrated Confectioners", Gazkomplektimpex LLC and others.

The NORBIT company works with the leading Russian enterprises among which large industrial holdings, business and production companies are Norilsk Nickel MMC, EvrazHolding, RUSAL company, the group SUAL, AB "ORGRESBANK", Ehrmann, Philip Morris, Integrated Confectioners holding, Ulyanovsk Automobile Plant, Ramensky mining and processing works, the Segezha PPM, Transgarant company, Bee-Ey-Si company, Norilsk Telecom, Euroset and also the state organizations – Administration of the Novosibirsk region, Administration of the Arkhangelsk region, the Agency by the state order of the Republic of Tatarstan, Federal Agency for Water Resources, Department of the state order of the Tver region, Department of economic development of the Republic of Mari El, the Ministry of Finance of the Moscow region and others.