VDC Takes a Look at Internet Uses in the Inventory Tank Gauging

7/15/2003 - A recent market study from Venture Development Corporation (VDC) investigates usage of the Internet within the Inventory Tank Gauging (ITG) and process level measurement industries. ITG is the use of level measurement for inventory storage and custody transfer, rather than in process control applications. Three uses of the Internet were investigated in a survey of purchasers:

Purchasers of inventory tank gauging systems were asked whether these are used for commodities they purchase and/or sell, and to what degree in these application use is made of the Internet or telemetry to track and manage inventory levels.

Sixty-three percent indicated usage for this purpose, and among these 40% indicated their suppliers use the Internet or telemetry to track and manage inventories.

Thirty-eight percent said they have such applications, and of these 44% indicated they use the Internet or telemetry to track and manage inventories of their customers.

In both cases, some respondents with no usage of the Internet or telemetry indicated this would likely be initiated in a year or two. Most, however, indicated they had no idea when such usage might be adopted. Some said they hope never for security reasons. Also, regarding monitoring of customer inventories this way - some saw this as a disadvantage, in that it reduces direct person-to-person contacts with customers.

Although on-line purchasing is growing in popularity, it is not growing at a rate previously expected. VDC asked purchasers who were not buying over the Internet in 2000 whether they expected to be purchasing these products on-line within two years. About 27% indicated they did. In the current study they were asked if they expect to be making near-term purchases on-line, and only 7% replied that they do.

One factor in this slower pace is that vendors and distributors have not created on-line ordering web sites to the degree expected. Also, technical support is a principal vendor selection criterion among purchasers, and many view this as being best obtained in person-to-person dealings. The purchases also often involve services beyond hardware, and have to be handled on a contract basis. Spare part orders are more likely to be ordered on-line.

About VDC
Founded in 1971, VDC is a technology market research and consulting firm that specializes in industrial and commercial electronics, computing, communications, software and power systems markets.

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