Or so says a San Jose-based Internet start-up calling itself TheSupply.com. Beginning this spring the company plans to launch an online service designed to streamline purchasing and foster communication between buyers and sellers of materials for semiconductor manufacturing, PC board fabrication and package assembly.

Geoff Wild, TheSupply.com president and chief executive officer, expects his company to conduct its first commercial transaction in April. The company, which raised $15 million in venture capital funding from Crosspoint Venture Partners, is actively soliciting beta customers for the site and Wild expects to be fully active by this summer. "We are really encouraged by the progress we've made and the interest that's been expressed," he said.

"The idea started germinating because we were seeing a lot of pressure. The Internet is changing the way people do business," Wild said. Wild is no stranger to the semiconductor industry. He was with Johnson Matthey Electronics for 17 years and was president and divisional director for the company from 1995 to 1997. His business unit grew from $250 million to $600 million in sales in three years. In 1997 the company also won Intel Corp.'s Supplier of Excellence award. Through the end of 1999, Wild was president of electronic materials at AlliedSignal Inc.

Many of TheSupply.com's potential customers are already using e-commerce but not within the semiconductor industry supply chain, Wild said. He noted that business-to-business e-commerce Internet sites have been successfully developed in other industries, however. Chemdex Corp., for example, is a supply and information site for the life-sciences industry launched in 1997. By mid-1999, the company had more than 300 suppliers online and 30,000 products offered through its site, as well as a lot of media attention for its rapid ascent in the world of e-commerce.

"Our aim is to put together a hub that is going to provide a comprehensive range of services over time," Wild said. He envisions that hub enabling the supply chain between buyers and suppliers to be more efficient. It would enhance communication and allow manufacturers to reduce inventories with the certainty that materials will be available when they need them, Wild said.

He cited a study by information technology consulting firm Aberdeen Group from June of last year that determined Internet purchasing, compared to traditional purchasing, could save 5 percent to 10 percent in the price of materials and services, cut purchasing and fulfillment cycles from 7.3 days to 2 days, reduce the cost of order requisitions from $107 to $30, and save 25 percent to 50 percent on inventory costs.

TestMart is a business-to-business e-commerce site for the test and measurement equipment industry that launched last year and is similar to the vision that Wild has for TheSupply.com. Peter Ostrow, president and CEO of TestMart, said that the semiconductor industry is indeed ready for e-commerce. The traditional means of doing business within the supply chain is significantly inefficient, he said. He suggested that if TheSupply.com can add value to the relationships between suppliers and buyers, then its success should rival that of TestMart and other successful e-commerce companies.

TestMart acts as a neutral third party and an information clearing house for the buyers and sellers of test and measurement equipment, Ostrow said. Wild sees TheSupply.com occupying a similar role for the semiconductor materials industry.

While TestMart and TheSupply.com may currently be the lone e-commerce players within the semiconductor industry, there apparently are others looming on the horizon, said Dave Toole, chairman of Gasonics International, San Jose. Toole serves on the value chain integration executive steering committee for the Semiconductor Industry Suppliers Association (formerly Semi-Sematech).

"I think there will be some areas of success, but I don't think (semiconductor e-commerce) will be as broad as people think," Toole said. Sharing information is beneficial to all parties involved in the supply chain, but when it comes to the semiconductor industry, intellectual property issues become involved, he said.

Seventy to 75 percent of the semiconductor materials market involves intellectual property in some capacity and companies will want to protect that, Toole suggested. He added, however, that the semiconductor materials is a multibillion-dollar market, leaving plenty of room for a company like TheSupply.com to be successful.