There are many companies making money on the Net — some you've heard of like Dell Computers who is doing $30 million a day 

Jaclyn Easton wrote a book called StrikingItRich.com  which lists 23 companies you never heard of who have been successful on the Net. Two of them are our clients, and we got an update from one of them — Coastal Tool & Supply who now does $10,000 a day on the Net, and who has done away with their catalog business. And, they opened a new 30,000 square foot store right across the street from their biggest competitor — Home Depot!

Why are these retailers important to you? 

If you don't recognize e-commerce or virtual stores, you are going to miss out on a lot of business. Too often manufacturers are reluctant to sell to e-commerce or virtual stores because they are afraid of losing business from their retail channel. Or they are not sure of the financial stability of e-commerce companies. Forget about it. The venture capitalists recognize the importance of these companies and are pouring money into Net-based companies. So, while they may not be profitable, they do have money. And, they will probably sell more merchandise than your average retailer.

What about channel conflicts with my retailers?

There are two issues here:

1.  Brick & mortar retailers are afraid of losing business to the Net.  B&M retailers will lose business to the net, just as they did to malls, catalogs, new competition, etc. IN NJ they just built a 1.3 million foot mall, to compete with such stalwarts as Garden State Plaza, Woodbridge, Short Hills and others. Where will these customers come from? The pocketbook is only so deep. The smart retailer will understand that cannibalization is necessary, before others do it.
2. Retailers are afraid you will sell direct. 3 - 5% of visitors to a site will purchase (on a good day). So what happens to the other 95 - 97%? They go to another retail, which may mean they go to your competition. According to Angela Kapp, V.P., Special Markets & New Media, Estee Lauder, you should focus on new customers, not on replenishment. If yours is a destination brand (i.e., household name), you can sell direct to the consumer -- otherwise, no.
    

Are My Competitors on the Internet?

You betcha! If they aren't now, they soon will be. On the Net we have the ability to see who has registered a domain name – your competitors. If they have registered, you can be sure it will only be a matter of time before they open for business. 
 
How do I fulfill orders?

If done right, you will receive an influx of orders from the Net. At the e-Tail 99 Conference here in Chicago in July, one CEO told how they were receiving approximately 25 orders a day in November of 1998. They then started some major advertising campaigns, and on December 10 they received 10,000 orders! A client of ours started some major TV commercials and their order volume quadrupled. 

So how do you handle the increased volume? If you are in doubt about whether you can handle increased volume, or you don't know what to do next, contact some experts who have done this before. Perhaps your accounting firm may have an MAS department that can help; or consulting firms who specialize in warehouse management or order processing.
 

1. Be sure you have a good back end system to process orders.  Some of the older legacy systems may not be able to handle an increase in volume. Look at the entire process, i.e., order taking, pick-pack-ship, billing, credit card authorization, etc.
2. Consider a radio-frequency (RF) controlled warehouse management system.
   Now they can be obtained for under $150,000. They allow you to update your records immediately as the order is processed. We installed a RF system at a client's warehouse in SC and the results have been startling. The system cost approximately $200,000 and they will see a payback in nine months.
3. Outsource your fulfillment process to companies who specialize in that function.
   Up to this point there weren't many companies around who would fulfill orders – not like catalog sales. Or there were very large companies like Fingerhut and Valley Media who fulfill orders for the major e-commerce sites. But not much available for the small to medium-sized company. 

 
We recently found a fulfillment service that looks promising -- Netship.    Two years ago, entrepreneur Dave Campbell took a fresh look at his successful, but traditional, franchise network of 120 pack and ship stores and envisioned an innovative distribution system for online retailers. They are a complete, integrated inventory management and fulfillment service that targets small and medium-sized wholesalers and retailers. The service utilizes an existing, trained and functioning nationwide network of more than 400 retail pack and ship centers (Affiliates). 

And they have a strategic alliance with Swiss-based Danzas Corporation, an international forwarding and logistics company with over 29,000 employees in 50 countries and annual revenues of $6 billion. Established in 1815, Danzas is the logistics unit of Deutsche Post and a world leader in logistics. 

This alliance means a seamless logistics solution to importers and exporters who need efficient logistics support to process their orders and deliver their products globally.

What about this security issue I hear about?