Small Businesses on the Web

E-biz nets minimal sales
for some small businesses

February 24, 2004

DES MOINES, Iowa -- John Peters is the guy who sells - through the Internet - the tools that make the tools that make the production equipment that make complicated machinery like John Deere and Caterpillar vehicles run.

Since setting up a Web site about four years ago, business has been good for Iowa Midland Supply Co., a 12-person sales and distribution operation. The Internet has helped the 85-year-old company enter the national sales market.

But the Cedar Rapids-based supply company is like many other small businesses in Iowa: touched by Internet sales, albeit touched lightly.

"Did it globalize us? No, not really," Peters said. "Did we get a good return on our investment? Yes."

But building a Web site, www.iowamidland.com, did allow the Cedar Rapids-based supply company to expand its business beyond the Iowa border, Peters said.

"We've seen some outside sales from places on the east coast and the west coast," Peters said. "It's mainly when people find a product on our site and it's the right price.

"It hasn't been a landslide of business."

About four years ago, the company went online with a Web site that allowed potential clients to view and get price quotes for the company's stock of tools and parts.

"Everyone wanted to get online," Peters said. "We - and everyone else - thought more people were going to switch to online shopping, so we decided we would give the Web a try."

The company mainly sells to the metal-working and automotive industries, Peters said.

"I want to invest a lot more into it, but weâre a small company," Peters said. "I try to invest as much of my time as I can to the Web site and its capabilities."

Lu Spaine has the same kind of dot com business tale. Spaine owns Zumi, 1141 42nd St. in Des Moines, a shop that sells ethnic clothing and jewelry for women, gifts and musical instruments. Spaine imports the goods from Africa, Asia, India, central South America and Indonesia.

The self-described "globalist" said she likes the idea of people bringing goods to Iowa from around the globe, but she also likes the idea of people anywhere being able to purchase them.

So when she opened her store in 2001, she also set up a Web site, www.zumi.com. Customers can browse her inventory and order goods through the site. But, Spaine said, "The majority of my business is from customers who actually come into the store. However, I've shipped some items out of state and such."

Peters and Spaine agree that conducting business on the Web can be difficult, if not discouraging, at times. All but about 10 percent of the supply companyâs business is conducted over the phone or in person, leaving only a fraction of sales transactions to the Internet, he said.

"Right now, it's like shooting in the dark," Peters said. "There'll be one month where we get lots of people calling about products they see on our Web site, and the next month we'll have only a few."

After subscribing to the initial dot com boom, Peters predicts the company - and likely many other small businesses here - will move ahead with future Internet and technology related advancements that will change the way business is done.

"I see another bubble coming up, we're getting ready for the next wave of e-commerce," Peters said. "I think the tides will be turning that way again."