Online
auction management services power up locally
By: Rick
Desloge
The phenomenon already
has hit the Coasts. And now, at least
five eBay online auction management services,
piggybacking off the explosive growth
of the eBay
online auctions, have targeted St.
Louis.
Two homegrown companies
are up and running: RidYourStuff.com and
StopnDrop.com opened within the last six
months. Another company, We-List-It of
Ellisville, formed in June. United Auction
Brokers, part of a national network, rolled
out Aug. 16.
The new businesses assist
sellers who want to list items with eBay,
but lack either the time or expertise
to manage the auction's details themselves.
Such services could help new eBay sellers
offering high-ticket items, such as laptop
computers, said Wendy Gauntt, founder
and owner of CIO Services, a St. Louis
technology consulting firm for small businesses.
"I would never buy
a high-dollar item from someone that didn't
have a high (positive) feedback rating,"
said Gauntt, a regular eBay shopper who
said few new sellers can offer any customer
feedback.
eBay is not the only
online auction, but by most measures it
is the biggest. Users sold $24 billion
worth of goods through the site last year.
The three local services
are luring customers with an easy way
to list items at the eBay.com Web site
and let someone else handle billing and
packaging. Customers pay for the convenience,
between 30 percent and 40 percent of the
first $100 sold, with fees dropping in
most cases as the merchandise goes up
in price.
Yet while the new auction
businesses here cater to individuals,
all of them have plans to go after corporate
customers.
"I'm out drumming
up corporate accounts and talking to them
about liquidating" excess merchandise
and old office equipment, said Darren
Eilers, chief executive of StopnDrop.
He said he's working with a company that's
selling its older computer equipment,
because its people don't have time to
find buyers.
His wife, Mindy, is president
of the company and handles the retail
end of the business. It opened in a 2,000-square-foot
storefront June 5 on Olive Boulevard in
Creve
Coeur. The Eilers and other
investors have raised $100,000, and say
they have enough funding to open their
first 10 locations.
The company's fees can
be negotiated for high-ticket items or
customers with high volume. For example,
the owner of a '69 Pontiac GTO listed,
for $10,000, is paying a negotiated fee,
Eilers said.
He declined to disclose
revenue to date, but said StopnDrop is
"about double what we expected to
be, and at the current (growth) rate,
we're within 30 days of being profitable.
Originally we thought it would take six
months."
The business now has
six employees, and Eilers said he is looking
for warehouse space.
"We could be profitable,
if we wanted to keep (the business) on
a small scale," said Jason Witte,
owner and president of RidYourStuff.com,
on Tesson Ferry Road in south St. Louis
County. But he's putting his money into
expanding, planning to have a second location
within 30 days and eventually five RidYourStuff
locations.
Witte previously ran
a sports memorabilia business. "I
had people coming in the (memorabilia)
store and asking me if I could place items
on eBay," he said, so he opened RidYourStuff
in March. Witte now has a staff of six
in 1,600 square feet. Sales have increased
every month and are now $30,000 a month
with RidYourStuff listing 25 to 30 new
items a day and monitoring about 150 auctions.
The biggest of the new
local players -- at least the only one
with a warehouse -- is Dale Oestreich,
the owner of ADS Logistics, a fulfillment
business in Maryland Heights.
Oestreich secured the
St. Louis market for United Auction Brokers,
a national company just unveiling its
services in seven states. He said he learned
of United Auction in July from his outside
marketing firm, Marketing Xperience, which
saw an immediate match for his 50,000-square-foot
warehouse. He called Ray Whitmer, United
Auction's founder, who drove here from
Lexington, Ky., later that month. The
two had a deal within two weeks.
The company plans to
use FedEx trucks to pick up items from
sellers. Fees start at about 30 percent
of the sale value. United Auction Brokers
is only working with people who own or
control an existing business, Whitmer
said. The real targets are businesses
selling closeout items, excess inventory
and used office equipment, which might
need part of Oestreich's warehouse.
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