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Reader Comments on Aardvark Daily 6 November 2001

Note: the comments below are the unabridged submissions of readers and do
not necessarily reflect the opinions of the publisher.


From: Tim Brown
For : The Editor (for publication)
Subj: Online Retail

Large scale online retail can work when backed with a
widely distributed bricks and mortar presence.

Woolworths online shopping (www.woolworths.co.nz), by my
guess, currently processes between 1,000 and 1,200 orders
per week.  My guess is that these orders average at least
$200 each so their turnover is of the order of $1,000,000
per month.  Included in that turnover is a minimum of $9.50
per order fulfilment fee (about $10,000/month).  If we
assume that the fulfilment fee covers the additional costs
of supply then the extra $1,000,000 month is all
additional, margin attracting, revenue for the business.

$1,000,000/month is small for a supermarket chain but there
are a lot of online businesses that would kill for that
turnover.  Woolworths have also recently invested in
improved delivery packaging so we can assume that the
business is at least close to profitable for them.

One key component of successful online retail is
fulfilment; if you cannot get the product to the purchaser
cheaply and quickly then you are unlikely to succeed.
Woolworths manages this with many fulfilment centres
(supermarkets).  Most other online retailers use couriers,
hence the success of online retailers offering small high
value items such as computer parts (for example
www.ascent.co.nz) rather than heavy lower value items such
as books (www.flyingpig.co.nz).

From: Camryn Brown
For : The Editor (for publication)
Subj: Flying Pig is Rubbish

I had a $30 Flying Pig gift voucher to blow (a present for
doing some beta testing for a local software developer)...
so I thought I'd better get in there this morning and blow
it while I have some chance of actually getting anything.

Flying Pig is an absolute steaming heap of a site... it's
certainly nothing like Amazon, which I find to be easy and
entertaining to use.

FP is difficult to search, ugly, incoherent, and sterile.

While it's a little sad to see an NZ company fail, I'm
comforted by the fact that its closure will give the rest
of the world one less reason to pity us.

Now Have Your Say

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