Document Type

Closed Project

Publication Date

Fall 2004


Dundar Kocaoglu

Course Title

Management of Engineering and Technology

Course Number

EMGT 520/620


eBay (Firm) -- Management, Technological innovations, eBay (Firm) -- Strategic planning, Engineering -- Management


Over the course of a decade eBay has exploded from a small startup into The World's Online Marketplace™. In 1995, eBay's founder Pierre Omidyar created a potent platform for a community of individuals and businesses to sell a host of goods and services. Millions of offerings across a multitude of categories are sold daily on eBay and, eBay's site dedicated to fixed price trading. In fact, 2003 produced over $2.1 billion in net revenues, up from $1.2 billion in 2002. [EBay's 2004 estimated revenues were announced as $3.15 billion, indicating that its continuing and unprecedented growth is showing no signs of slowing down. EBay's long-term mission is to create the world's most efficient and abundant marketplace in which anyone, anywhere, can buy or sell practically anything. However, as a pioneer in e-commerce, they are confronted with fierce competition and I many unprecedented "growing pains" associated with an e-commerce pioneer expanding rapidly into uncharted global markets.

Teclmically, operating a secure, 24-bour Online auction house is challenging enough, but meeting the demands of a rapidly expanding client-base presents problems that could linlit bow eBay does business. Because of the very nature of how eBay's online business functions, the sale of counterfeit and pirated goods continues to be problematic. Fraud is both difficult to prevent and investigate because of the high volume of transactions. Growing into other foreign markets, eBay anticipates that local, federal or international laws will make some transactions either difficult or impossible. EBay acknowledges that international expansion subjects them to a variety of risks. Their pullout from Japan in 2002 is evidence that local economic problems and competition are barriers internationally. Also, their recent move into China is not without risk either. Most Chinese citizens do not have checking accounts or credit cards for online transactions, and local competition is strong. Collectively, these and numerous other challenges add volatility to eBay's stock and pose as challenges to their future.


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