EBay Gets Down to Business

SAN FRANCISCO (03/20/2000) - EBay Inc. has revolutionized person-to-person sales. Now the online auction giant is hoping to do the same for business-to-business sales with the launch of its "Business Exchange" forum, targeting small and midsized business.

"This is the market where we believe compelling growth opportunities exist and where our traditional platform will work extremely well," says Brian Swette, EBay's chief operating officer.

Specifically, EBay is targeting businesses with fewer than 100 employees. Its Business Exchange service can be accessed directly from the EBay home page.

"It's a large market that's not being catered to at a lot of other sites," says Kevin Pursglove, EBay spokesperson.

On its first day of trading Wednesday, Business Exchange listed some 60,000 items in 34 different auction categories. They ranged from computer hardware (hubs and switches, scanners, servers) and software (accounting, business productivity, programming) to industrial equipment (compressors, lathes, industrial trucks, tractors, pumps) and professional tools (drills, nail guns, sanders, saws). Merchandise being offered may be new, used, or refurbished.

Making It Convenient

Many of the items, which are of particular interest to small businesses, were previously available in other areas on EBay. But this is the first time they've all been brought together and organized on one page, Pursglove says. Also, the Business Exchange features a number of new categories. For example, "routers" can be found under the headings of both "computer hardware" and "professional tools." Previously, there was no central location where an EBay user could find routers of any kind with consistency.

"Here it's going to be much more convenient for sellers and buyers," Pursglove says.

Business Exchange developed much the same way as EBay Motors, EBay's used car sales site.

"About this time last year, we noticed EBay users testing the market by listing automobiles in miscellaneous categories," Pursglove says. "We realized moving all of our auto items into one central location was an advantage and something our users wanted. We noticed the same phenomenon developing with small and medium-sized businesses."

"One of the things about EBay," Pursglove says, is that "users are the ones that dictate the marketplace."

While Business Exchange may be EBay's first step into the business-to-business market, it's not likely to be the last. Gartner Group analysts estimate this market will grow from $145 billion in annual worldwide sales to $3.95 trillion by 2003.

Pursglove will not reveal any specific future plans, but he says he expects Business Exchange to grow in the number of categories and the number of items listed for sale.

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