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eBay cutting ribbon for storefronts

The auction site will unveil its fixed-price storefronts initiative this week, but buyers will have to wait for features such as a shopping cart and a store directory.

2 min read
eBay's stores are opening for business.

The leading auction site will unveil its expected fixed-price storefronts initiative this week, company executives said Monday. But buyers may have to wait before purchases through the stores are as easy as those made through sites such as Amazon.com. The storefronts are still in a test phase, and many features such as a shopping cart and a directory of stores will not be incorporated until sometime this summer.

"We're not trying to say we are revolutionizing here," said Bill Cobb, senior vice president of global marketing for San Jose, Calif.-based eBay. "We're just announcing that we're open for business.

"This is the next step in our evolution to take our marketplace and platform and expand it in a logical way for our sellers."

eBay is only the latest online player to help businesses set up shop online. Amazon launched its own storefronts initiative about two years ago, and portals such as Yahoo have long offered their own versions.

But eBay is under pressure to expand its marketplace. The company has set a goal for $3 billion in revenue by 2005. To hit that target, it will have to grow at a rate of 50 percent a year until then.

eBay Chief Executive Meg Whitman told investors last month that the company would soon open storefronts as part of an effort to grow its sales. However, the company does not expect the storefronts to have an immediate effect on its revenue, spokesman Kevin Pursglove said Monday.

eBay plans to charge sellers $9.95 per month to have a storefront. It also will charge 5 cents per item to list fixed-price items through the stores and a fee ranging from 1.25 percent to 5 percent of the price of items sold. The company will not charge subscription or listing fees until September to sellers who sign up for a storefront before Aug. 1.

Some 30 eBay storefronts will launch this week, including stores from IBM, the Hard Rock Cafe and several smaller sellers, company executives said. Next Monday, eBay will allow all sellers to open stores on its site.

But in the initial phase, sellers will be able to do little with their storefronts besides list items for sale. Later this year, in addition to a shopping cart feature, eBay will launch a home page for its storefronts and will allow sellers to link to their goods on online marketplace Half.com.

One company, N.Y.-based Ardsley Musical Instrument Service, said the new storefronts should help it expand its online sales, but it's not sure yet which items it will list on its new eBay store.

"We're going to list as much stuff as we can and see what the reaction is and then build from there," company President Michael Pagliaro said. "The whole concept is somewhat new. As much as you might think that everyone likes to go gangbusters when they start out, I think we'll have to see what materializes from it."