There are many professionals that predicted the E-Commerce will have its own success. However, there is still some hidden E-Commerce that facing failures. One of the top 10 examples is the Pets.com. The Pets.com was started by Greg McLemore in November 1998. This company was purchased in early 1999 by a venture capitalist. Below are the main causes that lead to failure of Pets.com:-
i)Unstructured capital
The usage of the company’s capital for pets.com was not well organized. This is due to poor business planning on the advertising campaign alone, Pets.com already spent more than $100 millions in supporting it. Besides that, they had spent a lot in the marketing and sales. The loss had increased from since the company start business until in year 1999, it had reached loss of $61,778,000.
ii)Customer dissatisfaction
Most of the Pets.com customers are unhappy with this company’s delivery system. The company promised the customer on delivery of 3 days or less but they did not manage to do it. Furthermore, some of the customers needed to wait several days just to get their pet’s food.
iii)Poor management on costs
The company has a poor management on setting up the cost for the products and usually they will charge the products below the required cost. Thus, it makes the company to gain loss rather than profits. Moreover, the company had undercharge for shipping costs just to attract the customers but it actually facing loss on most of the items it sold.
The idea of pets.com was inadequate and there are a lot of problems that face by this company. Thus, it had taken over by the petsmart.com.
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