Sucker Punch From a Dot.Bomb
I went to my friend Jo's wedding the other month and later wrote on this blog about The Gift Registry: a wedding present service that seemed like a good idea at the time. The high concept was that the site kept the wedding list online which could be compiled from items stocked by a number of good quality department stores. Guests bought the bride and groom gifts they wanted, the company delivered and the wedding was less hassle from a gift wrapping and carting the present to and from the venue point of view.
Today I received an email from the bride and groom that the business had gone bankrupt together with advice to get a refund from my credit card company.
In my phone call with Jo what surprised her was that a dot.com with a sensible business proposition could go under, we are so used to dot.com being part of the mainstream shopping experience now that many people tend to forget that in the late 1990s Amazon was making a five dollar loss on each shipment. A similarly good prospect was CD retailer Boxman.com, who purchased CDs from the cheapest legitimate suppliers across Europe, and distributed centrally from a warehouse in the Netherlands, they then passed on some of the savings to the customer. Boxman was let down in the operational department by poorly implemented software from IBM. Travel site and gift e-tailer lastminute.com improved dramatically with the appointment of retail management guru Alan Leighton as chairman. The moral is that even with a winning business idea, operations expertise and processes are critical.
Here is a link to an article on the demise of The Gift Registry from Accountancy Age.