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Most people in business are aware of business directories. These have been around for a long time and Yell or yellow pages, are a good example. Before the advent of the Internet, businesses and customers used them to find businesses for a required service. They were sometimes very thick hard copy books that were delivered door to door and businesses would pay to be included into the business directory and also get the details of prime vendors list in usa .

When the Internet took off, business directories moved online and the basic principle did not change. They were lists of companies separated by categories. The big problem with Business directories is that the categories tend to be extremely broad so if you were looking for a company who sold cable glands for instance, you would search for companies under the category “Electrical Suppliers”. The electrical suppliers category would have hundreds of companies listed under them but they wouldn’t necessarily all sell cable glands. So you may end up contacting a lot of companies who can’t actually supply what you are looking for. And this is where Vendor-Sourcing Tools take over.

The main differential between a Business directory and a Vendor-Sourcing Tool is that Business directories work on the principle that people are looking for a business, while Vendor-Sourcing Tools believe that people are looking for products or services. Sure they will need a company who provide those goods and services with own vendor list but the company is not the prime factor in their search.

The concept of a vendor-sourcing tool was first seen in 2009 when it was used for the Oil & Gas and Petrochemical industries. These industries are extremely lucrative industries with projects having procurement budgets of many billions of dollars. Not only was the size of the projects and the amount of materials required a problem, but also more often than not the projects were being executed in remote locations. These factors made it extremely difficult for buyers.

In order to source vendors, Buyers relied on:

• Previous Project Vendor Lists
• Company Vendor databases
• Peer experience
• Google
• Businesses Directories

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Then main problems with these were that much of the information was out of date or inaccurate. In addition Company Vendor Databases for example were costly to maintain and almost impossible to keep up to date; Previous Project Vendor Lists only contained companies relevant for that specific project and not a total view so may not include all potential vendors. Google is a broad search tool and meant that searches were not always contextual or were restricted by IP location.

All of these issues made it extremely difficult for buyers to source vendors and similarly for vendors to let buyers know they existed and were able to assist with the supply for these projects.

The advancement in technology and global reach of the Internet opened the way for more efficient and practical solutions. Vendor-Sourcing Tools being one of those solutions. Based along the lines of many travel websites, the first Vendor-Sourcing tool for the Oil and Gas and Petrochemical industries was seen in 2010.

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