eBay supreme as online wars turn nasty

Some extracts from an article by Robert Gottliebsen:

The 2011-12 financial year, which starts in two days, will require a complete change of business model for a large number of Australian enterprises.
This week I was
talking with eBay Australia managing director Deborah Sharkey, who declares that the US giant is now set to be the biggest online shopping mall in Australia. In addition, she forecasts that online shopping will rise by 30 per cent compound a year which means – based on the current online retailing level of $27 billion a year – it will exceed $100 billion in five years….

…Every retailer in Australia must now look at their model and decide what response they should make.
We could go to Telstra’s Yellow Pages, which has historically had margins of well above 50 per cent. They have used that model to brilliantly drive Telstra’s cash flow. Now they are changing, and offering customers a mixture of print and electronic in whatever medium suits their customers.
That will result in much lower margins but will transform the business into a twenty-first century services provider…

At the end of the Sharkey interview, there is a most disturbing allegation – that some suppliers are not supplying goods to retailers on the eBay shopping mall. This will likely cause an ACCC inquiry. Should any retail or retail-linked groups be pressuring suppliers, then their executives face long and well-deserved jail sentences.

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