E-Surplus Market to Boom

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The Internet surplus-inventory sales market is poised to boom as more direct marketers discover what an efficient liquidation channel it can be, according to market research firm Winterberry Group LLC, New York.


The e-surplus market is expected to grow 128 percent annually from $7.8 billion this year to $93.3 billion in 2002, the firm said in a statement released yesterday.


More than $350 billion in product overstock and surplus inventory will have been sold through traditional channels in 1999, the company estimated.


"The efficiencies of the Internet converge for the betterment of this huge traditional marketplace," said Michael Petsky, CEO of Winterberry Group. "Manufacturers, wholesalers, direct marketers, and retailers will redefine their business models to take advantage of the growing demand for surplus products via the Internet."


The company predicts by 2002 e-surplus sales will account for 21 percent of $445.2 billion in total e-commerce sales and 25 percent of $425 billion in total surplus sales.


Currently, business-to-business sales are the lion's share of the e-surplus market, according to the Winterberry Group. The company estimates that 95 percent of $7.8 billion in online surplus sales were business-to-business this year.
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