Welcome to the Datalliance Vendor Managed Inventory (VMI) newsletter.

2006 Datalliance Growth Results

I am pleased to communicate that Datalliance recorded substantial growth results in all key business metrics for the year ending December 31, 2006. Sales transactions processed through the Datalliance VMI service exceeded $6B (54% increase over 2005), customer locations increased to 5,700 (58% increase), and total SKU's managed increased to 6.8M (19% increase). Existing Datalliance VMI customers across all industries continued to realize the business benefits of VMI as evidenced by their expanded use of VMI. During 2006, 80% of the Datalliance customer base increased the dollar volume of sales transactions processed through VMI. These results for 2006 continue the trend of strong and steady growth that we have realized in our VMI business over the past several years. More importantly, the increased level of VMI activity within the established Datalliance customer base illustrates the business value that you continue to receive from your VMI programs.

AMR Research Features Datalliance and SKF (Datalliance user) in Report on Software-as-a-Service Deployment Method for Vendor Managed Inventory (VMI)

In a recent Research Article, AMR Research (AMR) analyzed and reported on the benefits of Software-as-a-Service (SaaS) as a deployment method for Vendor Managed Inventory programs. AMR showcases the positive business results of leading truck parts supplier SKF, illustrating how SKF has combined active customer outreach with SaaS deployment methods to bring collaborative VMI to the automotive/truck aftermarket. SKF has utilized Datalliance as their turnkey VMI SaaS hub since 1997. AMR Benchmark Analytix data indicates companies that practice VMI with their suppliers hold 25% less material inventory on 6% lower total supply chain costs.

AMR points to the evolution of turnkey SaaS solutions as a technology milestone to support the broader implementation of VMI by stating, "Anecdotal evidence from companies like SKF suggests that SaaS is such an efficient mechanism for collaborative commerce that we may be witnessing the dissolution of the last of the major technical impediments to wider adoption of VMI best practices". This research report provides additional support for our SaaS deployment strategy and recognizes the business results that SKF has realized through their VMI program.

Click here to read the report.

Please save the date! The 2007 Datalliance Forum is September 12-13 in Cincinnati, Ohio. Details will be available over the coming months. I look forward to seeing you at this annual event.

As always, please continue to provide us with input on topics for future editions of this newsletter. Feel free to contact me at carl@datalliance.com with your ideas and suggestions. I hope you enjoy the newsletter!

Carl Hall
President, Datalliance

SupplyNet Communications Selects Datalliance VMI Solution

SupplyNet Communications is a leading provider of outsourced remote storage tank monitoring services for the petroleum and chemical industries

Datalliance announced that SupplyNet Communications, a leading supplier of outsourced remote storage tank monitoring services, has selected Datalliance. SupplyNet's TankLink service provides wireless monitoring and reporting of the flow of inventory through large storage tanks. Their customers include many of the world's largest petroleum and chemical companies. By integrating the TankLink service with the vendor managed inventory capabilities of Datalliance, SupplyNet customers will be able to take advantage of the increased functionality provided by VMI including automation of the product replenishment process...

Datalliance and McNaughton-McKay Conduct Webinar on "What Suppliers Should Know Before They Start a VMI Program"

Industry Data Exchange Association (IDEA) sponsors webinar

Datalliance recently conducted a webinar on "What Suppliers Should Know Before They Begin a VMI Program". Industry experts Bob Kuntzman, Requirements Planning Manager, McNaughton-McKay and Bob Jennings, VP Sales & Marketing, Datalliance, participated in the program. The webinar focused on the challenges encountered when establishing a successful VMI relationship and provided insight from one of the world's leading electrical distributors. The webinar was sponsored by the Industry Data Exchange Association (IDEA)...

Datalliance Records Substantial Growth in all areas of Vendor Managed Inventory Service for 2006

• VMI sales transactions processed through Datalliance increased 54%
• Number of customer locations utilizing Datalliance VMI service increased 58%
• Total SKU's managed by Datalliance increased 19%
• 80% of the Datalliance customer base increased the dollar volume of sales transactions processed through VMI

Datalliance Delivers New Release of Popular VMI Software

Datalliance announced the immediate availability of the latest release of Datalliance, a comprehensive internet-based VMI (Vendor Managed Inventory) e-commerce service. The new release includes expanded functionality to help Planners make better replenishment decisions as well as new and enhanced email and management reports...

Datalliance Operations/Data Center Update

In this issue of the Datalliance Newsletter, the Operations/Data Center Update focuses on two major system upgrades. In order to handle the large increase in the number of trading partners into our encrypted AS2 data exchange process, we have upgraded our AS2 server and moved the previous server into a backup role. Additionally, we are in the process of upgrading our IBM core operating system from AIX version 5.1 to AIX version 5.3.

Customer Care Tip - Two New Alerts Introduced!

As of September 2006, the Datalliance system had 24 unique alerts that could be selectively configured at the Distributor level such that VMI order reviews can be an exception-based process. Datalliance is always looking for ways in which to make the ordering process more exception driven while making increasingly better replenishment decisions at the item level. With this in mind, we would like to introduce you to two new alerts: Excess Pre-Days Supply and Item Not Sold In Recent History. Read the complete update for a detailed explanation of these two new alerts.

Webinar - VMI 101: An Introduction to Vendor Managed Inventory on February 26, 2007 at 2PM EST

Datalliance will present an overview of VMI and examine the competitive advantages it provides. The webinar is presented by Datalliance Staff and is open to the public.

For more information or to sign-up, please contact us at info@datalliance.com

Webinar - The Value of VMI in the Heavy Duty Aftermarket

As a prelude to the upcoming panel discussion at the Commercial Vehicle Solutions Network (CVSN) event in Kansas City, Datalliance presents an overview of the value VMI has delivered to heavy duty aftermarket. Learn how VMI addresses key areas of concern for distributors and suppliers and what results should be expected from a successful VMI partnership. Datalliance will share real world results achieved by heavy duty suppliers and distributors and share insights gained from our experience managing over 500 heavy duty distributor locations.

For more information or to sign-up, please contact us at info@datalliance.com

Carl Hall to present at the 2007 D/C Expo & Conference, The only End-to-End Supply Chain and Logistics IT show. The conference is to be held May 22-24, 2007 at Navy Pier, Chicago. Please visit the 2007 D/C Expo website at www.dcexpo.net for more information.

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Datalliance · 9916 Carver Road, Suite 500 · Cincinnati, Ohio 45242