1. Business Models 1 © Minder Chen, 1999-2002 Business Models Based on the Value Chain in the Marketplace Raw material producer Manufacturer Distributor Retailer Consumer Exchange B2B: Vericalnet.com B2C: Amazon.com C2B: Priceline.com C2C: eBay.com C2B B2C C2C New Middleman

2. Business Models 2 © Minder Chen, 1999-2002 Business Models: Multiple Dimensions Buy-sell direction: Buyer-side, seller side, and marketplace Industry covered: single vs. multiple (Vertical vs. Horizontal) Ownership: Buyer, seller, independent, software vendor, consortia Service: Core vs. extended services Products: Core vs. MRO; Direct vs. Indirect; Pricing: Fixed price, Auction, Reversed auction, negotiated Timing of purchase: Contact vs. spot vs. ad hoc

3. Business Models 3 © Minder Chen, 1999-2002 Big Buyer BigSupplierBigSuppliere-Procurement Direct Sales NetMarket Small Suppliers Portfolio of Buying & Selling Strategies Small Buyers Size of Buyers and Seller

4. Business Models 4 © Minder Chen, 1999-2002 Number of Sellers and Buyers

5. Business Models 5 © Minder Chen, 1999-2002 The Goldman Sachs B2B Windmill in the Age of Consortia