E-shoppers: Be careful out there

This season's buzz about e-commerce has turned into a high-pitched scream, with premier Net shops reporting that business and profits are off the charts and analysts predicting that online vendors will rake in somewhere between $2.3 billion and $3.5 billion this year.

Still, e-tailers themselves say that consumers have to be realistic about the logistics of ordering products online. Shipping deadlines and depleted inventories mean that online shopping isn't always the perfect substitute to long lines and jammed parking lots.

"While they look really good on the screen, their back-end ability to process orders may not always be there," said Mark Goldstein, chief executive of the ImpulseBuy Network, a Burlingame, California, company that partners with merchants to promote their sale items to online consumers.

"Don't wait until the last minute," Goldstein advised. "When you buy something online, you need to get the shipping confirmation--that means your order is really on the way. Until you receive that, you haven't bought anything."

The clock is ticking
Shipping may seem like the last step in online shopping, but vendors say it should be the first consideration when a buyer sets out to surf for gifts.

In fact, if buyers want their gifts to arrive by Christmas, most e-commerce sites say that the shopping season unofficially ends more than a week before December 24 due to shipping deadlines.

For regular ground shipping, most sites say purchases must be made by December 12 to 14 in order to ship before Christmas. For UPS second-day service, in general orders must be in by December 15 to 17. And the cut-off date for the most expensive shipping method--UPS Express or Federal Express--is December 20 to 21 in most cases.

Shipping restrictions aren't the only thing Net shoppers should keep in mind. Time is a factor in other ways as well.

Prominent sites such as Toys R Us and Buy.com already have crashed or been bogged down due to traffic overloads, dispelling the notion that shopping online is always faster than going to a physical store.

Unfilled orders can also slow shoppers down.

Although many of the traditional catalog giants are now pushing their goods online, in some cases their inventory systems are not real time.

When consumers add an item to their virtual shopping cart, there is a chance that product already has sold out via a catlaog company's mail-order divison or other distribution channels.

For example, JCrew's Web site uses a real-time inventory system, but due to human error, inventory could be entered incorrectly, meaning people could order items even when they sold out.

"A situation like this happens less than 1 percent of the time to our customers," said Brian Sugar, a spokesman for JCrew New Media. "JCrew keeps extremely accurate inventory levels. There are times, though, that what we think we have is different that what we actually have. This is true for both mail order and on our Web site."

Like catalog buyers, online shoppers won't be informed until days later that the item is out of stock when they get a conciliatory call from the merchant and possibly a discount certificate. But then it's back to the mall--online or off--to hunt for the item that sold out.

"Moving from catalogs to the online world hasn't changed any of those problems yet. Most haven't built a completely different inventory system to do this," said Tim Brady, vice president of production for Yahoo Shopping, which features goods from more than 2,700 independent stores.

Most exclusive Net vendors do have real-time inventory systems or are moving that way, however, which will prevent consumers from ordering items that are no longer available or are on reorder.

"That is the promise of the Web, the ability when you run out of something to take it down--unlike with the print world," Brady added. "Hopefully, with a [real-time inventory system], when a retailer is running out of something they can get back to the manufacturer better so they can stock up faster."

Popular e-tailers such as Amazon.com and eToys do run real-time inventory systems and say they can handle the holiday rush.

"In terms of the season, our systems have ample capacity and we have a seasonal workforce as well," said Kay Dangaard, a spokeswoman for Amazon. "As far as the shipping, most of the items are available within 24 hours and when an item is ordered it has the shipping time attached to it."

Amazon's books usually ship in three to seven business days--one-day delivery costs an additional $8 per shipment for books and $5 for CDs. But as executives explain, there is a big difference between the book and toy industries resulting in more shipping and inventory constraints for the toy retailer.

"With books they can get a new order in a few weeks. Same with CDs and software," said Phil Polishook, vice president of marketing for eToys. "That is just not true in the toy business because everything is made in the Far East way in advance. We predict demand pretty well, but we are continuously monitoring what is selling and then reordering."

Polishook said consumers should make sure an online vendor manages its own inventory, which can make all the difference in getting a product on time.

"We manage our own real-time inventory, so if you order the last Bounce Around Tiger, and someone else goes to order it two seconds later, they will get a message that says 'sorry we're are out,'" he said. "This is not to say we never had an unintentional back order--the only times we would have this problem is in cases when somebody entered inventory wrong."

Faulty goods
Even if online shoppers place an order in time, once it ships there is one last thing to keep in mind--the quality of the item.

Sure, if Net users buy from a reputable merchant and pick a popular item such as Happy Holidays Barbie 1998, they can likely trust they are getting what they paid for.

But if an item could be damaged during shipment or otherwise, consumers should check a site's return policy before handing over cash.

Gap Online lets buyers return items to their nearest Gap store, or via mail to receive a refund, store credit, or a gift check. One note, however: items purchased at a brick-and-mortar location can't be returned through the online system.

Alibiris, a vendor of rare and out-of-print books, guarantees the condition of any book it describes and takes returns for a full refund within 30 days of receipt.

There also is the danger of counterfeit goods such as software, clothes, toys, or jewelry.

Cyveillance, a Virginia company that uses a proprietary technology to monitor the Net for illegal copies of items manufactured by its clients, estimates that 10 percent of the 25,000 sites selling luxury goods this season are pushing imitations of expensive Gucci, Coach, Calvin Klein, or Rolex products.

"Children's toys are not the only items being counterfeited and sold over the Internet this holiday," Brandy Thomas, chief executive of Cyveillance, said in a statement.

"The Internet has become a hotbed for sale of counterfeit luxury items that you might typically find on any street corner in New York City--watches, pens, sunglasses, leather goods, you name it," he added. "Like in the streets of New York, prices that seem too good to be true, usually are."

Consumers may want to check the Federal Trade Commission's online shopping tips to help avoid scams and breaches of their payment and personal information.

"If you're not familiar with a merchant, ask for a paper catalog or brochure to get a better idea of their merchandise and services," the FTC advises. "Before you provide a company with personal information, check its privacy policy. If you can't find a policy, send an email or written message to the Web site to ask about its policy and request that it be posted on the site."

If consumers think they have been cheated or mislead, they also can file a complaint with the FTC or their local attorney general's office.