SalesBid loses hope for B2C

By Basheera Khan for SBi

Johannesburg, 18 Jun 2001

SalesBid, a commerce solutions provider, is to restructure as of 1 July. The company has exited the business-to-consumer (B2C) market with immediate effect, and will focus instead on its business-to-business (B2B) operations.

"SalesBid started as an extension of our brick-and-mortar operations and today is a full-scale technology house. It is recognised locally and abroad for its cutting-edge developments in dynamic pricing, and has moved so far away from the Auction Alliance core auction business, that we believe it fits far better into a technology company," says Auction Alliance CEO Rael Levitt.

Levitt sees the changes as radical, but explains that in the South African market, there is no money in B2C. "We'd rather be in B2B. SalesBid performed at breakeven, but we couldn't see the upside. What other B2C players are doing in this country, God alone knows."

The B2C side of SalesBid will close down, affecting seven people including David Bloch, one-time CEO of the company. Auction Alliance Holdings is in negotiation with management of the B2B side of the company, in the hope of a management buy-out of the technology division.

"We see the blue sky arena in our brick-and-mortar business," says Levitt.

Jonathan Gluckman, SalesBid operations director, says the company will continue to support its B2C clients, in cases where those clients have been driving their online auctions to a degree of success. However, the company will no longer drive new business in this regard.

Gluckman says the company's renewed attentions will be devoted to the European market, and will centre around a new technology allowing for spot pricing of products online based on any number of external variables. It is still uncertain at this stage whether B2B operations will be conducted under the SalesBid brand.

In a statement released to the press today, Salesbid comments: "The company has decided to exit the B2C market because its investment in resources and administration has not delivered sufficient returns to justify a continuation. The market in SA really is not big enough to justify the effort."

SalesBid clients included ITWeb, Africam, Protea Hotels, iafrica.com and Moneyweb.