Thales will use Ivalua’s Internet-hosted software to manage some $7.8 billion in annual purchasing across its aerospace, defense, network security and transportation manufacturing businesses.
Paul Demery , Managing Editor, B2B E-commerce
Thales Group, a France-based company that manufactures products for the aerospace, defense, financial network security and transportation industries, is deploying a new e-purchasing system to better manage how it buys products and materials across its multiple markets, the company says.
"We were looking for a tool that would allow us to develop a collaborative approach within the purchasing community, thus ensuring the best possible level of service for our customers,” says Renaud Larramendy, director of purchasing process and tools.
Thales, which runs up total annual purchasing bills across its product lines of some $7.8 billion, plans to have its 1,350 buyers of products, equipment and materials use Ivalua Inc.’s Ivalua Buyer e-purchasing tool. The aim is to ensure abide by corporate spending policies, purchase from approved suppliers within approved spending limits and maximize buying power, Larramendy says.
“Introducing a collaborative tool like Ivalua Buyer enables us to pursue the transformation initiatives implemented by the Group and to reinforce our values, such as ‘One team, One Thales,’ as well as helping make us more competitive,” he adds.
Invalua provides its Ivalua Buyer e-purchasing application to most clients as a software-as-a-service, or SaaS, which lets client companies access the e-procurement application through web browsers. About 20% of its clients opt for on-premise software that they run on their own web servers, Invalua says.
The Ivalua Buyer software suite includes modules for setting up new supplier contracts through e-sourcing, managing ongoing relationships with suppliers, evaluating suppliers’ performance in delivering goods, and using online dashboards for viewing and managing purchasing records. Prices for the full SaaS suite run between $30,000 and $90,000 per year per software module, says Gérard Dahan, general manager for Ivalua’s EMEA region, or Europe, Middle East and Africa.
Ivalua, based in the Paris suburb of Orsay, competes with other providers of e-procurement and supply chain management technology including Ariba, a unit of the Germany-based business software giant SAP AG. Indeed, Ivalua sees SAP’s acquisition, in the fall of 2012, as helping it to expand Ivalua’s market among companies that don’t use SAP’s business software, Dahan says.
Total revenue rose 50% last year to about $18.5 million, he adds. “We’re industry-agnostic, and see growth among heavy manufacturing industries, medical services, banks and the public sector, including the Canadian government,” Dahan says. Other customers include diversified electronic systems manufacturer Honeywell International Inc., tire manufacturer Michelin and mobile phone services provider Orange.
Ivalua sees particularly strong growth in North America, where in 2013 it booked contracts for future sales totaling $25 million, he says, adding, “We expect big growth in the U.S. —40 to 50%—this year.”
Ivalua operates U.S. offices in Redwood City, CA, and Washington, DC. It also maintains offices in Quebec, Canada; Frankfurt, Germany; and Milano, Italy.
Duncan Jones, an analyst who follows procurement technology companies for Forrester Research Inc., says Ivalua’s software suite is more tightly integrated with customer data than Ariba’s, but has less functionality for such tasks as managing invoices. While Ivalua’s software suite is smaller and provides easier access to centralized customer data—which allows it to more easily build new customized features for its clients—Ariba already offers more functionality for meeting many companies’ needs, Jones says.
Ivalua says it intends to continue building out its software suite’s functionality with research-and-development teams in the U.S. as well as Europe.
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