Impact of Using an E-Marketplace in the Construction Supply Process: Lessons from a Case Study

Abstract

The procurement process is critical for construction companies. To improve it, many are resorting to e-marketplaces although they usually do not know exactly how much they can gain by doing so. This paper describes a study that measured the benefits of using an e-marketplace to support the procurement process of a construction company. The study included three marketplaces currently operating in Chile. However, in this paper, we focus on Iconstruye, the most important one. 70 executives and professionals from 25 construction companies randomly selected from the 89 that used this marketplace, were interviewed and asked to fill out a questionnaire. This data was validated using data from Iconstruye and from 33 suppliers. The results show that the adoption of an e-marketplace reduces turnaround time, errors, urgent orders, and irregular purchases. A more reliable procurement process directly contributes to a leaner construction process by reducing upstream variability, procurement cycle times, and the need for large inventories on site. Users also perceive an improvement in certain global indicators when using an e-marketplace.