OpenECX and its WebContractor application provides an end-to-end – purchase order to payment – SaaS-based process management platform.
The UK construction e-commerce sector isn’t one I’ve looked at that closely, particularly when it comes to managing buyer/supplier financial transactions between construction businesses. I have tended only to give it a brief mention if it involves a SaaS collaboration vendor, for example: Asite (whose Adoddle platform incorporates a procurement hub) or Causeway (Tradex) – both of which allow interchange with other hubs via the Hub Alliance. Coins ETC is another competitor in this sector, as is another UK-based vendor, OpenECX, which is seemingly positioning itself to compete with Textura too.
The trading hub technology underpinning OpenECX was, until April 2015, previously marketed as Adaptris ECX (electronic construction exchange), having been launched in 2012 as a construction-specific business within the system integration specialist Adaptris group by former Coins executive Matthew Jones. Earlier this year, it completed a management buy-out, backed by experienced construction software investor Richard Beaton (who, incidentally, supported the November 2014 Business Collaborator MBO – post), and is now growing its sales and consultancy teams.
OpenECX describes its cloud-based trading hub, eHub3, as “the first fully system agnostic and independent cloud-based trading system for the entire construction industry”, and the company is focused on delivering e-commerce and subcontractor solutions to construction businesses. Trading in 20 countries worldwide, 700+ active trading partners include Hilti, Fergusons, Kier Group and John Sisk and Son.
The materials supply trading hub is OpenECX’s core product, but Matthew is particularly keen to talk about its complementing product: the company’s WebContractor applications for payment service. This provides an end-to-end – purchase order to payment – process management platform to support construction customer-subcontractor commercial relationships, including automating self-billing agreements, e-invoices, purchase orders and authenticated VAT receipts for tax purposes.
Payment processes in the UK are increasingly tightly governed by the Construction Act (strictly, the Housing Grants, Construction and Regeneration Act, to give it its full title, plus the Scheme for Construction Contracts (England and Wales) Regulations). This legislation has been progressively tightened as successive governments have sought to clamp down on poor payment practices. Consequently, commercial managers and directors are under pressure to comply with requirements regarding the timely issue of acknowledgements and of notices and other communications to subcontractors under the Act. Matthew says:
We are seeing rocketing interest in WebContractor from main contractors seeking to de-risk their payment processes. An auditable SaaS-based hub like our’s gives both sides a consolidated view, improves visibility of payment progress and so helps foster trust and collaboration.
The platform has similarities with Textura-CPM (post), but has been developed in the UK for the UK, with extensive input from both main contractors and from financial services businesses who are frequently party to construction transactions. OpenECX also offers optional working capital provision (similar to Textura’s EPP) with London-based financial services partner Woodsford Tradebridge.
Once a main contractor opts to use OpenECX it takes about two months to onboard, during which time OpenECX will also start showcasing the system to the company’s subcontractors. Matthew continues:
We can quickly be taking thousands off a main contractor’s overheads if they become enterprise users. However, we can also be flexible about pricing, setting up across a few projects and allowing contractors to use as much or as little of the service as they need and paying just for what they’ve used. We also make set-up easy; our PDF-to-XML process needs no adaptors or APIs – we can start automating the process using a subcontractor’s standard PDF invoice.