Telecom NZ closes www.Ferrit.co.nz - New Zealand's largest online shopping mall
Telecom NZ is closing www.Ferrit.co.nz, said to be New Zealand’s largest online shopping mall.
The shock news was announced via a corporate media release dated Monday 12th January, and has also been published on the home page at
www.ferrit.co.nz.
It seems that the service was unprofitable and, whilst still growing in popularity, was unlikely to become profitable any time soon.
“Ferrit has continued to grow during the past three years but the current retail environment has meant the break-even point has shifted out a
number of years.
The decision has now been made to refocus and resources will be directed to other areas,” said Alan Gourdie, CEO, Telecom NZ Retail.
He added that Ferrit had helped spur the development of a local online and ecommerce sector.
“Telecom’s aim in launching Ferrit was to help develop New Zealand’s online retail market.
Since 2005 we’ve seen a growth in retail adoption of online with many retail players adopting ecommerce and web capabilities.”
Even so, Telecom NZ’s decision to walk away from Ferrit is hardly a vote of confidence for online shopping across the Tasman and
is particularly bad news for its participating retailers and its suppliers.
Around a hundred local retailers had a presence with Ferrit which, although it enabled online shoppers to buy directly, also facilitated
links to retailers own on-line stores.
Indeed, in retrospect, it might even be said that Ferrit’s fees and charges encouraged participating retailers
to direct shoppers to their own online stores
rather than buying from within their Ferrit sub-site.
To have a shopping cart in their sub-site, Ferrit charged participating retailers a $NZ250 establishment fee and a three-tiered monthly fee.
Small retailers paid $NZ75 per month, medium-sized retailers paid $NZ199 and large retailers paid $NZ499 a month.
On top of that they paid commissions of up to 8% on each sale and cost-recovery charges to upload data and product details.
Participating retailers also needed to have a merchant account with Ferrit’s bankers, the ANZ.
With such steep fees it is perhaps surprising that the site didn’t make money for Telecom NZ.
One obvious cost factor would have been the license for the German developed ePages software used in the site.
However it is hard to imagine that the license fee was all that expensive and web-hosting and telecommunications costs would have been
insignificant for New Zealands largest telecommunications company.
The loss of the business will, nevertheless, be a blow for the Australian company that supplied the ePages software, Sydney-based eCorner.
Other Ferrit suppliers who will lose out from the site’s closure include payments gateway, - Direct Payment Solutions.
A statement published on the front page of the site says that Ferrit will stop taking online orders as from Wednesday 14 January at 5pm but will
continue to
direct visitors to the retailers’ own websites from ferrit.co.nz.
For more information go to
www.ferrit.co.nz
www.telecom.co.nz
www.ecorner.com.au
www.dps.co.nz
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