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eBay Plans Industry's First Online Auction Shipping Services with Mail Boxes Etc. and iShip.com

By James Hollander & Andy Wang
Apr 12, 1999 12:00 AM PT

There was good news for online auction buyers and sellers on Monday, as eBay (Nasdaq: EBAY) announced plans for two new deals which will integrate product shipping capabilities directly into eBay's popular Internet-based auction Web site. eBay chose Mail Boxes Etc. (MBE), which is reportedly the world's largest franchisor of packing and shipping services, and iShip.com, a leading provider of multi-carrier Web-based shipping services for e-commerce, to provide eBay members with a first-of-its-kind, integrated system for e-commerce shipping.

eBay Plans Industry's First Online Auction Shipping Services with Mail Boxes Etc. and iShip.com

The new alliance plans on developing a system to inform buyers of the shipping costs associated with their purchases, even before they place their bids. The network of participating MBE centers nationwide will provide convenient drop-off and pick-up locations for e-commerce shipments, while instant package status information will enable sellers and buyers to track the exact location of the goods during transit.

Industry Impact

This announcement is significant because it could foreshadow a trend towards end-to-end integration of e-commerce services in the online auction industry, which has seen remarkable user and investment growth in the past year.

"As the volume of e-commerce increases, shipping solutions that bridge the Web and the physical world become critical," said James Amos, MBE president and CEO.

Despite its legal troubles, eBay is arguably the Internet's top online auction site. This arrangement with MBE and iShip could raise the bar in the industry even higher, in terms of providing value-added services to auction participants. For this reason, we expect to hear similar announcements in the near future from other major online auction players like Bid.com, Yahoo! Actions and newcomer Amazon.com Auctions.

"The growth of eBay's person-to-person online trading has created a demand for improved shipping solutions for our community of 2.1 million users," said Meg Whitman, president and chief executive officer of eBay.

Under the planned agreement, iShip.com will provide information to eBay sellers and buyers regarding shipping costs and options, helping reduce the need for frequent e-mails to work out terms of shipping. MBE will offer eBay sellers and buyers the brick-and-mortar infrastructure for packing and shipping. In addition, eBay and MBE expect to implement a "hold for inspection" program where MBE franchisees will provide a place for delivery and inspection of goods.

About Mail Boxes Etc. and iShip.com

Mail Boxes Etc., a wholly owned subsidiary of U.S. Office Products (Nasdaq: OFIS), is the world's largest franchiser of retail business, communications and postal service centers. Mail Boxes Etc. operates 3,700 shipping centers worldwide. Parent company U.S. Office Products is a North American provider of office supplies, office furniture, and office coffee and breakroom products.

iShip.com is a privately held company that helps buyers and sellers price and ship products. Founded in 1997, iShip.com now operates a Web site that provides shipping rates for Airborne Express, Federal Express, United Parcel Service, and the United States Postal Service. Based in Bellevue, Washington, the company has an impressive list of investors including Intel, United Parcel Service, and the venture capital firm of Draper, Fisher, Jurvetson.

Stock Impact

Shares of U.S. Office Products (Nasdaq: OFIS) were on a tear in early trading today after the news, climbing more than 50 percent, up two points to 5-7/8.

eBay stock, meanwhile, has regained all the losses that began when Amazon.com recently announced the launch of its new auction site. Shares of eBay were up as much as 10-11/16 to 194-1/6 in early trading today, hovering around an all-time high. The highest the stock has ever closed is 191.

It's been quite a two-day run for eBay stock, which closed up 11-5/8 to 183-3/8 on Friday.

Related News

In related news on Monday, Yahoo! Auctions, eBay, LiveBid.com, Amazon.com Auctions, and other Internet auction sites announced that they will join together to raise funds to aid the Kosovo refugees. The participating Internet companies will auction off donated items, collectibles and memorabilia, and/or enable all online sellers and visitors to make donations to the American Red Cross relief efforts to meet the emergency humanitarian needs of refugees fleeing from Kosovo. All proceeds raised will reportedly go directly to the American Red Cross.

"We applaud the collective efforts of these Internet companies to work together to help the American Red Cross reach the refugees who are suffering in this crisis," said Steve Bullock, acting president of the American Red Cross. "These Internet companies are providing a tremendous vehicle to bring people together and raise awareness and needed funds. It's thanks to donations like these that the Red Cross can be there for these families, providing them with the food, shelter, and comfort they so desperately need."

Humanitarian gesture or pure publicity? You decide.


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Salesforce Industries Summit
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