BREAKFAST WITH THE FOOL
Monday, December 27, 1999
"Start with what is right rather than what is acceptable."
-- Peter Drucker
Priceline.com to Enter Yard Sale Market
Brian Graney (TMF Panic)
As e-commerce intermediary priceline.com (Nasdaq: PCLN) charges ahead to hook up every single virtual seller with every single virtual buyer on the Internet, it was only a matter of time before the company moved into that sacred realm of American localized commerce -- the yard sale. According to The Wall Street Journal, priceline.com is set to unveil a website called Perfect YardSale that is geared toward taking business away from big-time auction sites run by eBay (Nasdaq: EBAY), Yahoo! (Nasdaq: YHOO), and Amazon.com (Nasdaq: AMZN) as well as the driveway dealings overseen by Aunt Martha and Uncle Harry.
The site will "have a heavy emphasis on 'quality secondhand goods' like old video-game cartridges, exercise bicycles, and television sets," the Journal reported. The service will be rolled out in major metropolitan areas so prospective buyers can check out the goods before plunking down their cash. In classic priceline.com interactive haggling style, a buyer will be allowed to place a bid for an item below the offered price on the website, which the seller can then choose to accept or not. Sellers will pay priceline.com a fee for every ware listed on the Perfect YardSale site and for every item that is eventually sold there, while buyers will hand over a fee for every purchase they make on the site.
While the Journal emphasized the competition that priceline.com will face in the auction business, localized yard sales seem like a logical extension of the priceline.com concept. As the company's main airline ticketing service works by providing airlines with incremental revenue for seats that would otherwise go unsold, the yard sale allows a seller to collect some money on what would otherwise be incremental household junk and clutter. In that sense, perhaps the enterprises with the most to lose from priceline.com's yard sale initiative are not the other online auctions sites but donation-based secondhand retailers such as The Salvation Army and Goodwill Industries.
News to Go
Prison owner Prison Realty Trust (NYSE: PZN) announced a restructuring that includes a total equity infusion of $350 million from a group of outside investors and the removal of Chairman and CEO Doctor Crants and other senior managers. Prison Realty is also giving up its REIT status to combine with its prison lessee, Corrections Corp. of America.
Shareholder meetings scheduled for this week to approve the proposed merger of Zions Bancorp. (Nasdaq: ZION) and First Security Corp. (Nasdaq: FSCO) will be delayed to allow Zions to restate its financial results for the past three years and properly take into account the effects of past pooling-of-interests transactions. Zions said the restatement "in no way reduces the benefits" of its merger with First Security.
Industrial flow management services company Flowserve Corp. (NYSE: FLS) announced a restructuring that will result in a 9% reduction of its global workforce and an unspecified charge to the firm's fourth-quarter earnings.
Software-based telecommunications test equipment supplier Catapult Communications (Nasdaq: CATT) unveiled a stock buyback plan for up to 2 million of its outstanding shares.