Integrated/Automated Trading System (ITS)

Integrated/Automated Trading System (ITS) is a bespoke technology solution that enables seamless integration and automation of manual processes using advanced technology across trade execution and settlement. This is a robust digital platform that delivers a digital information flow of buying and selling products seamlessly while removing manual and paper based processes from the value chain. It gives access to information to various stakeholders involved in a system through a web portal or mobile phone.

Eastern Software Solutions in collaboration with its technology partner have delivered the Integrated Tea Trading System (ITTS) to East African Tea Trade Association (EATTA). This digitization platform is transforming tea trade on the African continent. It will enable the farmers in the remotest part of Africa to trace the movement of his or her tea across factories and shipping companies, and the market trends affecting tea trade in the world. Through adoption of the Integrated Tea Trading System (ITTS) EATTA made it possible, digitizing efforts that are automating the various aspects of tea trade, building transparency and ridding key industry players of manual processes by supporting digital platforms that will enhance tea trade.

East African Tea Trade Association (EATTA)

Kenya and its neighbors in East and Central Africa regions are not only big consumers of tea, but also leading producers who trade most of their black tea at the Mombasa Tea Auction. The East African Tea Trade Association is an organization that bring together Tea Producers, Buyers (Exporters), Brokers, Tea Packers and Warehouses, all working to promote the best interests of the Tea Trade in Africa. Presently, membership comprises over 300 companies extending across the East and Central African borders. EATTA mandated to promote and facilitate the interests of all the stakeholders in the tea trade in Africa by creating an enabling business environment geared towards maintaining global standards and delivering tea products to the customers in the most profitable way.

Mombasa Tea Auction ran as a manual auction for the last 20 years. In 2016, EATTA began the journey of automating the Mombasa Tea Auction with the help of Trademark East Africa (TMEA). The automation was in a view of enhancing efficiency with which teas are sold through the auction.

Also Read : iTTS software to automate the Auction Process of EATTA

ESS: The iTTS system incorporates four modules which include:

Membership module-This covers first-time application, renewal of membership, and management of membership issues.

Catalogue module- The module covers Tea dispatch by producers. Once the producer has dispatched the teas, the broker consolidates the teas from the different producers and prepares a closing catalogue. The warehouse has also the mandate of updating received teas in the iTTS once they physically arrive at the warehouse. On the week before the auction, the broker publishes a sale catalogue that has the valuations and their comments on the teas. This is the final catalogue that is used for auction. The buyer has also a feature to preset prices and input their comments.

Auction module-This is a transition in the actual bidding process from the manual outcry system to a fully automated system. It is a trade engine with different logic to accept the highest bid value offered by Buyers and declare the sale.

Business module-Supports generation of sale Invoices by the brokers and payment references by the buyers. The module also integrates with Bank systems to get confirmation on the payment receipt. When payment is updated on iTTS, the broker generates Tea Release Documents and Delivery orders. Once the buyer has received the delivery order, they generate Loading Instruction which is sent to the warehouse to enable the release of teas. The warehouse releases teas based on the loading instruction and issues a Release Certificate.

iTTS Process Flow

• Pre-auction
• Auction
• Post-auction

Benefits of the Integrated Tea Trading System (iTTS)

Central Data Repository System

Data mining from the online auctions which will provide EATTA and its members, as well as other tea stakeholders in the region and globally with useful data to analyze market trends, analyze market dynamics and respond to demand promptly.

Increased Transparency and visibility

Farmers will be provided with accurate information on the prices their teas fetch at the auction. Buyers on the other hand will be able to compare prices and various teas on sale.

Ease and convenience of selling teas

The Integrated Tea Trading System can be accessed from remote locations and therefore authorized buyers can participate in an auction at their comfort. This is a departure from the traditional auction that would require a physical presence at the auction floor in Mombasa.

Increased buyer participation

There is an opportunity for more Buyers participation. Participation of the buyers is not restricted by the physical size of the auction floor.

Introduction of multi-auction system

With the upcoming initiatives on running parallel auction systems, more volumes will be traded on within the shortest time possible.

The Strengths of The Auction System

• Everything is public. Weekly prices are set in an open forum, with great transparency about who is buying and at what prices.
• Everybody pays the same price for the same tea. Large multinational companies have no ability to negotiate lower prices.
• Smaller producers can participate. It is possible for any producer to market their tea to the local, regional and international market. Without the auction it would be very difficult and very expensive to do this.
• Smaller buyers can participate. All producers sell a proportion of their tea at auction, so even the smallest buyers can have access. The ability to divide lots also means tea can be bought in much smaller quantities.
• It is highly efficient. It is a very effective way of moving large volumes of tea from producers to buyers, and helps producers’ cash flow.

Eastern Software Solutions is working on various embarking projects using advanced technology like IoT, BI and RPA across Africa and other continents. Please contact us to discover the best technology solution for your business!