BUSINESSWEEK ONLINE : AUGUST 14, 2000 ISSUE
FRONTIER -- FEATURES Printing Money The difference between PrintNation.com and other small-business Internet exchanges is black and white: It thrives on true e-commerce, not ads, fees, or off-line negotiations. The core business of the privately held company is online distribution. It sells ink, paper, and other tools of the trade to commercial printers. By aggregating purchases of its 2,000 members, PrintNation is able to cut better deals with suppliers. And finding bargains is crucial to commercial printers. The industry is highly fragmented, with 80% of the more than 50,000 U.S. printers employing fewer than 20 employees. ''Most printers make just about 3% margins. It's brutal,'' says Tony Seba, CEO of the Irvine (Calif.) company. ''One of the problems is that they don't get price breaks.'' At PrintNation, where the average order is $400 per visit, discounts run 5% to 10%. That has been good for David Midler, co-owner of Atlanta printer Presentech Inc. In the past six months, he has spent $50,000 online with PrintNation and figures he has saved $10,000. ''I bought a large-format printer for posters. The best deal I could find from local dealers was $10,000. PrintNation sold it to me for $8,000 and shipped it in three days, free of charge.'' Starting this month, commercial printers can log on and auction items from $1,200 scanners to $570,000 presses--and pay for them online. They can also arrange shipping and financing. Such functions can only boost the popularity of a site that has drawn rave reviews since it was launched in October. ''I bought a $10,000 printer for $1,000 on their auction site,'' says Gary Kerbein, owner of Kerbein Printing, in Elmira, N.Y. ''How that's possible, I don't know. But I did it.'' For its trouble, PrintNation takes a 5% commission when the bid is closed. Now, 10 months after opening for business, PrintNation sells ''hundreds of thousands of dollars'' worth of products each month, says Seba. And it has attracted more than $31 million in financing, including $25.5 million from Lehman Brothers Holdings Inc. PrintNation isn't printing money just yet, but it seems to have the right supplies. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS To B2B or Not to B2B TABLE: How B2B Might Be TABLE: A B2B Site Sampler Printing Money INTERACT E-Mail to Business Week Online

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