Business-to-consumer online auctioning has proven a difficult exercise to sustain in Australia, proposes Chris Haylock, the general manager of dot-com auctioneer Stuff.com.au.
Lack of sufficiently discounted new stock and subsequently narrow retail "markup" in Australia means local dot-com auctioneers are less able to lure customers with low starting prices, he said.
In fact, any e-tailer unable to offer lower prices than its offline competitors risks losing business to those competitors, he said.
"No matter what you do, it all comes down to price."In the US, where retail markup is typically higher, dot-com auctioneers can use aggressive price cuts to attract online buyers' attention, he said.
Nevertheless, Stuff this week announced a broadening of its range of dot-com offerings, including rebranding its auction site as Stuff Marketplace.
While the company's site will retain its original "core business" of "person-to-person" trading, Stuff will now offer both B2C trading and B2B trading.
Accordingly, Haylock said, the company would alter its revenue model in early 2001, when the company plans to charge suppliers service fees for their use of the site.
Currently, the company's revenues are attracted through sales commission and display advertising.
While unable to disclose recent revenue figures for the company, Haylock explained that Stuff would place a greater focus on revenues when the new model took effect next year.
"We still see ourselves in startup mode," he said.
Stuff, which launched in Australia 12 months ago, claims an online membership of 40,000, with page impressions pipping the 1.5 million mark in March this year.