Walla Communications (TASE: WALA) online retailing site Walla Shops has launched “Walla Buy”, the Israeli version of eBay, which will enable private surfers to buy and sell second hand goods. Visitors to the site will be able to carry out transactions through straightforward sale, an auction or a bulletin board. Dispatch company UPS will deliver all goods sold through the site.
The Walla Shops e-commerce site was first launched in 2000 and is operated by Walla Shopmind. Considered one of Israel’s largest e-commerce sites, Walla Shops’ share of the NIS 1.5 billion online retailing market in Israel totaled NIS 300 million in 2005. Walla Shops is controlled equally by the Walla Group and holding company Cypertech, which is owned by the Fishman Group through Globescom (38%), and Shai Livnat, Amir Adler and Ilan Fadlon through Zoe Holdings (62%). Cypertech, a developer of e-commerce solutions is a reincarnation of the defunct Commerce Mind which closed following the bursting of the bubble four years ago.
Walla Buy’s profit model is based on a commission rate of 6% on sales. There will also be a one-time charge of NIS 3 for selling through the site (which will not be collected during the initial trial period) as well as a one-time vendor registration fee. All payments will be charged to vendors only. Walla Shops will invest NIS 2 million in the site whose development will continue over the next eighteen months. The company says it expects sales generated by the site to top NIS 300 million within three years, and that the site will generate profit within two years.
eBay has annual sales of $45 billion and 181 million users. Walla Shops is building its hopes for Walla Buy on a monthly audience of 1.5 million surfers and the increasing popularity of second hand goods.
Eliezer Fishman is the controlling shareholder in “Globes.”
Published by Globes [online], Israel business news - www.globes.co.il - on March 23, 2006
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