E-tailers upset by E-Store creditors' decision

E-tailers upset by E-Store creditors' decision

The decision to keep E-Store afloat has puzzled and even angered fellow e-tailers, who described the move as "a waste".

"I am very surprised the creditors would agree to keep trading. It is a business that could have been trading while insolvent -- a business that offered creditors 15 cents in the dollar," said Brandon Walsh, managing director of Web and catalogue reseller PAW Products. "Why are [the creditors] bailing them out?"

Michael Glezerson, managing director of (formerly, does not see the business surviving in the long term.

"I think they were cowboys in terms of margins," he said. "They were working at 3 per cent -- we didn't even bother trying to compete with that. All they got themselves was a great customer database but no business."

Walsh said E-Store created a price discrepancy in the market, which worked to the detriment of all e-tailers. "They were trying to buy market share through price. There was no service whatsoever, deliveries went astray because they had no facilities to handle problems. You need systems and people in place if you want to succeed in the long term.

"I don't think the pure e-tailer can work without staff or warehouses, because they can't look after the customer," Walsh said.

Glezerson said he noticed prices on E-Store's site go up again since it was placed in administration, signalling the unworkable margins are over. "But I'd still be nervous buying from them," he said.

Walsh was baffled that the likes of Tech Pacific would enable the e-tailer to continue trading, and is suspicious about the motives of several creditors. "Tech Pacific went to great lengths to aid E-Store -- measures it would not go to for any other e-tailer," he said.

"One and one doesn't equal two in this case."

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