This on-line connection is an interactive system that gives distributors direct and immediate access to information at various Hubbell divisions in a user-friendly, Windows-based environment on a mainframe, personal computer or manufacturers service platform via the CompuServeTM network. The service provides immediate data on stock availability, current pricing, purchase order status, quotation status and direct order entry. Therefore, with each order, the closest shipping point is automatically determined in order to guarantee quick turnarounds; status reports are updated throughout the shipping cycle; and on-screen help is available to assist in maneuvering through the system.

Through the SMART Hubbell Connection, distributors also have e-mail access to their counterparts at all participating Hubbell divisions, fostering communication and facilitating access to Hubbell personnel.

SMART Electronic Data Interchange

SMART EDI allows the exchange of information by computers via a value-added network (VAN). Transactions are transmitted via standard ANSI X12 communications from a central computer to an electronic mailbox, from which Hubbell "picks up" the transactions and processes them.

This system has already been proven to:

• minimize shipping errors
• improve order efficiency
• cut lead times in half
• increase distributor profits
• assist in managing inventory levels
• reduce overhead costs

Already noted benefits of EDI order entry include efficiency, reduced errors and increased profits by eliminating manual order handling and extraneous printing and faxing.

SMART Vendor Managed Inventory (VMI)

SMART VMI is a unique and innovative capabilities-based program where Hubbell divisions and distributors work together to automate nearly every step of the inventory and ordering process through a computer-based system of checks and balances that allows Hubbell to manage distributor inventory electronically. SMART VMI incorporates systems to monitor sales, inventory status, planning and ordering, materials shipping and receiving, and the corresponding invoices and manifests that accompany each step - thus eliminating any investment in inventory that doesn't move.

Distributors, therefore, can spend less time managing mountains of paperwork, inventory orders and invoices, and spend more time building relationships and business with customers.

Highlights of the SMART VMI program include:

Improved Inventory Turns
SMART VMI can be specifically tailored to individual organizations to achieve the appropriate inventory turns - based on its impact on service levels - at any location. The average distributor improves turns by 30 to 50 percent.

Improved Service Levels
The SMART process will ensure that your Hubbell inventory is at the right levels and mix to enhance customer service levels. Service levels are maintained at 97 to 98 percent, which is the primary target of the program.

Improved Inventory Control
On a daily basis, Hubbell reviews inventory position against pre-established inventory policies to determine replenishment requirements based on demand. In critical situations, product will be shipped daily.

Reduced Inventory Investment
The replenishment process ensures the maximum utilization of inventory investment while maintaining appropriate product to satisfy requirements. Obsolete or slow-moving inventory is eliminated and new or promotional items can be accommodated. On average, there is a reduction of 20 to 30 percent in the inventory.

Reduced Transaction Costs
Automating the process of identifying and satisfying inventory requirements reduces transaction costs and decreases the amount of paper associated with transaction processing. Typically, the amount of purchase orders and invoices are reduced by 50 percent.

Increased Sales
SMART is geared to manage stock with high-velocity and unpredictable demand to ensure availability when the end-user orders it. This allows Hubbell to monitor inventory and ensure availability, while minimizing stock outs. Sales increases of 6 to 10 percent can be attributed directly to SMART VMI.

Improved Profit Margins
The VMI program gives distributors the flexibility to maximize profit margins as price becomes a secondary issue to customers if product is available when they need it. Due to improved management of C-class inventory, profit margins have been increased by as much as 10 percent.

SMART Internet Access

In early 1997, distributors were able to access the SMART Hubbell Connection through the Internet. This new extension to Hubbell's existing menu of electronic commerce choices will encompass the same benefits and features as the Connection while adding the ease and graphical interface of the World Wide Web. The goal of this latest innovation is to provide a secure mechanism for electronic commerce in a user-friendly environment.