Thứ Hai, 20 tháng 6, 2016
Nice little earners: you can make money online! Maxwell Cooter tracks down some shrewd companies using a bit of sound business sense to turn a tidy profit on the Web
There's plenty of doom and gloom in the media when it comes to portraying Internet companies. It seems as though every technically challenged hack delights in wiring stories about e-commerce companies that have come to grief. Of course, some of the putative millionaires we were reading about just a couple of years ago have indeed fallen in spectacular fashion, while other media stars, such as Lastminute.com, have survived but aren't quit as glamolous as they were perceived t be back in 1999. You can read more here
But away from the headlines, there are hundreds of small Internet-based operations making a good living, using technology successfully and serving thousands of satisfied customers. Most of the businessmen and women that run them aren't going t become millionaries (and if they're certainly not boasting about it) but they're not particularly worried about that, What they share is a delight in working for themselves, a belief in the power of the internet, and a strong commitment to customer service.
Here we feature a small sample of the many companies that are thumbing their noses at the doom-merchants by continuing to thrive.
Farmer Sally Robinson wasn't put off by received wiscom that the internet was only for young, professional males when she set up her Web business, Ample Bosom. As the name suggests, the site is aimed at women with a fuller figure.
Operating a Yorkshire farm might seem incompatible with running a dotcom company, but an online venture is perfect for Robinson, as it means she can run everything from home.
Ample Bosom didn't start as a Web business. It began with a print catalogue, but Sally say it was always her intention to introduce a Web element. She went online in November 1999, about two months after the catalogue business launched, and the Internet and catalogue sales each now contribute 50 per cent to her turnover.
The site is powered by Actinic Catalog, which copes with about 40 orders a day - although there are slightly more orders on Thursdays, for some reason that Robinson can't explain.
Robinson has struggled to get bra suppliers to meet the rapid turnaround that online purchasers expect, so she's forced to hold stocks of all items. The goods are light and cheap to post, but because fit is important, she gets more returns than the average e-business.
A lot of Ample Bosom's customers are based overseas. We get a lot of ex-pats in places like Saudi Arabia and the Far East shopping with us. They find it particularly hard to find bras in the Far East as most shops cater for a much smaller customer," Robinson says.
The company's idyllically situated, and has a lot of technology behind it. It's integrating the Actinic e-commerce software with the Sage accountancy package to improve the sales process, and has recently upgraded to broadband with a satellite connection. In fact it's probably the most technologically advanced farmhouse in North Yorkshire.
People are motivated to work for themselves for all sorts of reasons. Chris Jellings, an IT director from Leeds, wanted to run a business from home so he could stay and look after the family's small menagerie of animals better.
Calling on his love of progressive rock and heavy metal, he set up online record shop Crimson Dog with his wife Tina in February of this year. He'd worked in a record shop when he was younger, and had several contacts from running music fanzines.
Jellings has been surprised at how quickly the business has taken off, Like many owners of smaller online shops, he started off selling through eBay, and although he has recently constructed his own website and started selling through that, he's still dependent on eBay for the bulk of his sates. He's now getting about 250 enquiries a week and turning about a third of those into sales. Naturally, turnover varies, but he takes in about [pounds sterling]400 in slow weeks and up to [pounds sterling]750 in good ones.
He's particularly impressed with eBay, and says the experience of working with the company has been immensely pleasurable. "We've dealt with about 2,500 people, and only a couple have been awkward."
Jellings says eBay made it easy to set up shop, and thinks its recent acquisition of PayPal is going to be a big plus. He sees a distinct split between the sales he makes on eBay and those he makes from his own website. "I sell the progressive and heavy metal stuff off my site, while eBay sales are more mainstream pop."
His only concern is escalating postage costs. "The Royal Mail recently put postage up by 60 per cent. It adds a lot to the cost of purchase."
Like many Internet storeowners, he isn't unduly ambitious. "As long as I can make a living, I'll be happy," he says. "I don't want to be the next Richard Branson."
If there's one Internet company that defined e-commerce in the dotcom boom era, it was Firebox, with its toys for boys approach. In the last three years, the company has matured, become profitable, and settled in for the long haul.
CEO Michael Smith admits its initial approach was heavily slanted towards young men, but he points out that 18-34 year old Web-savvy blokes were the people who were buying over the Internet at the time. The blokeishness is now gradually being phased out, and the company has a more widespread customer base--about 90 per cent UK, with a 60:40 male/female split. Smith estimates Firebox should produce a turnover of about [pounds sterling]400,000 in 2002.
The company has been profitable for about a year. Smith thinks there are three reasons why it has thrived while others have gone to the wall. "We've spent very little on marketing. Because we're offering far more than commodity products, it's generally been easy to get written about--and PR is far more effective than advertising. Second, our products give us very high margins--there have been too many Web companies out there trying to operate on low margins who end up getting squeezed by suppliers. And finally, the products that we offer aren't widely available on the high street, so they have to come to us."
Firebox had typically humble dotcom beginnings. It started in an attic in Cardiff in 1998, with an initial investment of [pounds sterling]1,000 from Smith's mum. With his business partner Tom Boardman, Smith kicked off the company by selling a shot glass chess set.
Firebox is no longer Internet only--it produces a paper catalogue--and Smith says they have toyed with the idea of opening a high street shop. "It's important to give customers a choice of media," he says.
He says he's "ecstatic" about the way the Internet has allowed him to build up the company, and expects it to thrive for some time to come.
Like many successful Internet companies, Cardiff-based Blushingbuyer starts from a simple premise: that there are certain items people are embarrassed about buying in shops and would prefer to be able to get anonymously online.
Founder and MD Steve Aicheler says the company began when he and fellow founder John Schlamm graduated from university and decided to set up a business. The idea came to Aicheler when he found himself getting embarrassed while buying condoms.
Now, two years later, the site sells considerably more than condoms and is performing so welt that Blushingbuyer was a regional award winner in the UK Online E-commerce awards.
The company has also had its share of controversy. Certain media outlets got hold of the story that it had been partly funded by government money through the Welsh Development Agency (WDA). There were shock horror headlines about government-funded sex shops. But the hysteria died down after it was pointed out that the store sold more than condoms and sex aids, and allowed customers to shop for items related to embarrassing medical problems.
The WDA money was a useful bonus for Aicheler. The company started in the summer of 2000, lust as the dotcom boom was beginning to fade, and it initially had difficulty getting backing. Aicheler says the WDA cash helped attract other investors. He also had a struggle getting suppliers to deal with the company at first, although this has eased now it has a trading record.
Aicheler is philosophical about the initial financial struggles. "If we'd set it up a year earlier, I'd be a millionaire by now, but then I wouldn't have a business either." He is disappointed in the way the media treats dotcom companies. "It's always yet another story about Last minute or Amazon. There are lots of businesses on the Web out there doing very well."
The site was built using Actinic Catalog and Aicheler says the company is growing by about 10 per cent a month. Finances are healthy, but he won't reveal their exact position. "It's something we never comment on," he says.
Nor is there such a thing as the typical blushing buyer. "All we can say with certainty is that they're aged between 16 and 60, are somewhere in the world, and have an embarrassing problem."
Aicheler is convinced that the Internet will be a successful commercial medium and expects Blushingbuyer to continue to grow. "We have no plans for a physical outlet, but if we were to open one, then given the nature of the business, it would have to be very tongue-in-cheek."
About three years ago, there was a small glut of Internet businesses whose selling point was that customers became company shareholders. In theory, it looked a compelling idea - customers had a direct financial incentive for using the site, which in turn would mean that the company could offer them shares. Unfortunately, it didn't work out that way - there were too many competing dotcoms around at the time, and most of the businesses set up in the boom years of '98 and '99 have vanished.
But not all of them. Themutual.net still offers shares to customers and is going strong. Not only that, but it floated on AIM (the alternative market) in 2000 and is now profitable, having made [pounds sterling]86,000 on revenues of [pounds sterling]262,000 in the quarter to June 2002.
MD Ben Heaton says the future is looking rosy for Themutual.net. The company had budgeted for a static summer, but Heaton has been amazed at the level of business it's been doing in what are traditionally low-spending months - and during a time when consumer spending is down.
Heaton attributes the company's success to a number of factors. Chief among these is that it's been prepared to change its business strategy. "Too many companies have written their business plans and think they have to stick to them," he says. "Companies have to respond to environmental conditions. Things change every day." He points out that the company has also managed to keep a tight control on all of its costs. There are only eight employees.
Themutual.net has already had a major change in its approach. It started off as a lottery company, but relaunched in November 2001, changing its revenue model. Now, it acts as an intermediary to several major stores, offering free shares to members who use them. "Of course, people can go direct to those stores, but they can also go to them through us and get shares for doing so."
He says it's not about getting lust a few pence. "One of our most popular stores at the moment is the Marbles credit card. Members who sign up for the card can earn 61,100 shares, which at current prices are worth about [pounds sterling]20."
Intermediary software automatically calculates the sum owed to Themutual.net after every trade - that way invoicing and other financial records are kept to a minimum.
The company has great faith in the future of the Web as a transaction medium. Heaton talks about how much he hopes the shares will be worth in 10 and 20 years' time. The company already has 235,000 members and continues to sign up people at the rate of 500 a week, but he's hungry for more. "Our ambition is to get 10,000 a week".
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