As dot-coms struggle to attract customers and cash, investors have fallen in love with another bit of digital-age jargon: b2b.
It stands for business-to-business, and it refers to using the Net to link suppliers to their customers and provide other corporate services. Sure, it sounds boring. But unlike most online retailers, some b2b ventures actually stand a chance of turning a profit.
My favorite b2b effort, though, doesn’t make any money. Moreover, it doesn’t plan to.
Instead, it’s designed to achieve a higher goal: feeding the hungry.
America’s Second Harvest (www.americassecondharvest.com), the nation’s 10th largest charity, distributes more than a billion pounds of food each year to 26 million people across the country. While that might sound like plenty, the group hopes an investment in b2b technology will help it accomplish even more.
Distributing fruits, grains, frozen entrees and other such foodstuffs from a far-flung group of donors to more than 200 food banks and rescue programs across the nation is a daunting task. Keeping track of everything with faxes and phone calls would seem to be all but impossible.
Yet that’s how America’s Second Harvest does business. The group gets much of its food from large manufacturers like ConAgra, Kraft and General Mills. Often the items are production overruns or are too close to their expiration date to deliver to grocery stores.
No time to waste
If a manufacturer finds itself with something to donate, it faxes the group’s main office in Chicago with the specifics. Workers then type that information into an aging computer program that uses regional demographic data to make educated guesses about where the food might be most needed.
Someone then faxes a food bank in that area. If it wants the food, workers there fax a response and make arrangements to pick up those items from the manufacturer.
The process takes an average of six or seven days, time enough for some donated food to go bad. This is particularly true of precooked heat-and-eat meals, which are growing more popular with consumers.
“Traditionally you think of people donating things like cereal, rice and beans,” said Sue Hofer, a spokeswoman for America’s Second Harvest.
“But someone who’s transitioning from welfare to work, probably working two full-time jobs, has even less time to cook than an upper-middle-class housewife,” she said. “They’re the ones who can really take advantage of pre-marinated meat and other prepared foods.”
That’s why the group is moving to adopt a state-of-the-art inventory control system that uses the Web to interact with both donors and food banks. Local agencies will be able to post reservations for the exact items they need, and they will be automatically linked with donors who can fulfill those needs.
America’s Second Harvest also will be able to show manufacturers exactly which items were donated by each of their remote warehouses, making it easier to seek appropriate deductions at tax time.
The improvements have been funded so far by donations from the U.S. Department of Commerce, the ConAgra Feeding Children Better Foundation and, most recently, a $7 million grant from the Donald W. Reynolds Foundation. The group still needs additional donations to be able to finish its system on schedule by 2002.
When the project is complete, the average time it takes donations to reach food banks should be cut in half. Less food will be wasted, and donors will be able to offer bags of prewashed salad and other such perishables with confidence that they’ll reach hungry people in time to do some good.
“We’re basically taking time out of the process, which is a universal business goal,” said David Prendergast, vice president of technology for America’s Second Harvest. “But in our case, there’s a particular urgency because there are expiration dates attached to everything we handle.”
Of course, this b2b success story won’t do investors much good. A nonprofit group that’s using the Net to streamline operations isn’t exactly a hot stock tip.
For some, though, it might just mean a hot meal.
To contact syndicated columnist Joe Salkowski, you can e-mail him at email@example.com or write to him c/o Tribune Media Services Inc., 435 N. Michigan Ave., Suite 1400, Chicago, Ill., 60611.