Online venture rejuvenates marine equipment trader

Old Economy meets New as Standard Ship Spares' online venture, marine52.com, has huge indirect benefits on the whole company's operations

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By  David Ingham Published  February 1, 2001

2000 wasn’t the best of years in Standard Ship Spares industry of engineering and ship spares. As trading in the United Arab Emirates generally slowed down, fewer ships came into port needing spare parts.

Yet, thanks largely to its online marketplace, marine52.com, sales & marketing director, Murtaza Jabir Rasheed, says the company was able to keep its revenues roughly level with the previous year. Otherwise, he believes, the company could have been facing a drop in turnover of up to 15%.

“Marine52 has gone way beyond my expectations,” says Rasheed. “Now we’re thinking about sitting down with a professional expert to see where we go with it.”

So how could a Web site possibly make a difference to a company that’s been selling ship spare parts for years?

The answer to that question lies in the type of online offering that Standard Ship Spares has tried to develop. The marine portal’s most obvious feature is a marketplace facility, where buyers can post requests for parts. Requests are regularly posted there from as far away as the Netherlands and East Asia.

Anyone is free to browse the site and there’s no charge for using the marketplace facility, either as a buyer or seller. That means that Standard Ship Spares’ rivals are just as free to make follow up calls on posts as marine52’s owners are.

But whilst finding new customers is one of the clear benefits of the site, there’s something much more important that it gives Standard Ship Spares: credibility and reputation. “It reinforces the fact that we’re here and that we’re reliable,” says Rasheed.

“I’m not making money on the Web site, but I’m making a reputation that’s worth a lot. That’s as good as money in the bank,” he adds.

He believes that as a result of the favourable reception for marine52, Standard Ship Spares has been able to get its foot in more doors than it would otherwise have been able to. That’s been particularly the case in the Far East, where ownership of marine52 allowed company founder and managing director, Jabir Rasheed, to set up meetings with manufacturers that resulted in the establishment of partnerships.

“It’s helped us to go to different markets that we weren’t in before,” says Murtaza Rasheed. “Through this, we’ve found suppliers from the Far East.”

It’s a uniquely regional example of what analysts are calling ‘bricks & clicks’ or ‘convergence.’ It’s the idea that the really successful businesses in the 21st century will be those so-called Old Economy companies that successfully use technology and the Internet to expand their market reach and find new customers.

There have been well over 300 requests for supplies posted in the site’s marketplace section since its creation less than a year ago. Rasheed admits to being somewhat overwhelmed by the positive reception marine52 has received and to being a little unsure as to how to develop it going forward.

He has spent a minimal amount of money on the site and has managed to avoid it becoming a large distraction for Standard Ship Spares. But he knows that will be increasingly hard to achieve as the portal’s popularity grows.

“This is an added expense for our company,” says Rasheed. “I want it to run on its own and generate revenue on its own. That’s what we’re working right now to figure out.”

He says he’s optimistic about the prospects for advertising. Whilst analysts predict that online advertising worldwide is going out of fashion, he believes a niche site like marine52 represents a strong advertising vehicle.

“I read that advertising on the Web is weakening but on marine52 it could still be a big thing because the market is so niche,” he argues. “If you’re not a marine professional, you’ll never come to marine52, but if you are you’ll come to my site and that is good exposure for an advertiser.”

Nevertheless, he adds, “I’m fortunate that this Web site isn’t my revenue.” There’s a few pure dot-coms that must be wishing for exactly the same thing.

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