Many Americans (and the number is growing by the day) have purchased books, clothing, airline tickets and other items ranging from trendy toys to expensive antiques over the Internet. E-commerce is no longer a distant concept, but is fast becoming a convenient reality. It seems as if almost anything that can be sold through traditional bricks-and-mortar channels can now be sold on the Internet.

Real Estate Moves Online with Owners.com

But what about homes? Imagine a world without flimsy "For Sale" signs staked into lawns and grossly abbreviated home listings in newspapers-a world in which Web postings offer property photos, and information ranging from the home's dimensions to the quality of local schools. With the help of some friends, Hans Koch not only imagined this world, he built it.

In 1995, Koch had an inspiration. Several people he knew had recently gone through the process of buying a home, and his mother was in the midst of selling hers. With an extensive background in real estate, Koch knew that the services available to realtors, like national automated listings, were not available to individuals in the For Sale By Owner (FSBO) category. "So I began to ask the question," recalls Koch. "Why couldn't consumers get the same benefit of a national automated service on their own?"

Just as Koch was asking this question, the "Information Superhighway" was taking off and a company called America Online was beginning to bring Internet access into homes across the country. Koch and business partner Jack Reibling conducted some customer research. They began by asking people who were not hooked up to the Internet the following question: "If an avenue existed-other than the newspaper-where you could list your home for a large audience, would you use it?" Encouraged by extremely positive responses, Koch and Reibling, CEO and president respectively, launched their company-Owners.com-and created its Web site.

Owners.com is the first completely searchable, accessible national database of FSBO homes. This sophisticated site features more than $8 billion worth of homes and property located across 50 states (up from 23 initially) and is one of the fastest growing real estate listing databases on the Internet. In addition to providing listings, Owners.com includes services such as area school information, property mapping, a local business directory, and books and articles on buying or selling a home. All of these support the firm's mission statement: "To empower individuals to buy and sell properties on their own and to facilitate growth of the For Sale By Owner real estate market."

People who are selling their homes and want to be listed on the Web site can do so at no charge. In addition, a tiered service is available in which they can purchase space for more information or take advantage of priority ranking in search results. For example, sellers can display up to five different photos of their home, feature a catchy tagline, receive a customized, professional yard sign for posting, and have their home listed first in search results for around $100.

Compared to the average $10,000 that people spend when listing with realtors, this online option is understandably appealing. "People want to be more in control," Koch comments. "They would rather not turn over the process of selling their home to a realtor who will take a big commission when other options are available."

Would-be buyers, conversely, can look at the properties listed on the Owners.com site and then have contacts to call, e-mail or visit to find out more. In the future, Koch and Reibling hope to facilitate complete online home-purchasing transactions-including signing the papers and handing over the title.

The real estate market is currently 20 percent FSBO. Koch and Reibling have utilized the Internet to increase the FSBO market share, aided by this medium's ease-of-use factor. "That," according to Koch, "gives us a real advantage." He tells one story of a couple who listed their home late Thursday evening, received a call Friday morning from an interested buyer and closed the deal a week later. While Koch admits this is not a typical situation, "it nonetheless indicates how quick, efficient and easy it is to sell a home on the Web," he notes.

Owners.com, which began in a living room, has become an enormous success in a few short years, adding more departments (including customer service), and building corporate partnerships with companies like E-loan and Homeshark. The Wall Street Journal recently rated the site as "the best for-sale-by-owner network" and PC Magazine listed it as a "Top 100" Web site.

Big name Internet players are also paying attention. Yahoo, the number one Internet portal in terms of popularity, offered Owners.com a posting within the "Sales by Owner" search category-an arrangement that has significantly increased exposure.

Owners.com is even drawing comparisons to the Web retail giant Amazon.com, which causes Koch to joke: "We don't need that kind of pressure."

With all these accolades, it is clear that Owners.com is filling an important niche. "I think our success was a combination of luck and innovation," says Koch modestly. "If we can accomplish everything that a realtor does without the commission, then we offer a real value proposition."

IPNet Takes on the Industry Giants

The growing popularity of e-commerce is giving small companies an unprecedented opportunity to compete with industry giants and win. No one knows this better than Newport, California-based IPNet Solutions that, with only 40 employees, is taking on such heavyweights as Netscape, GE Information Services, and Harbinger and Sterling in developing e-commerce solutions for companies of all sizes. "Despite the competition," notes CEO and founder Donald E. Willis Jr., "we are reaping some very nice Fortune 500 wins."

A major key to IPNet's success has been its expertise with the e-commerce technology "electronic data interchange." EDI, as it is commonly known, facilitates business-to-business transactions at low cost by formatting data so computers can talk to each other directly over the Web. "If you want to reduce handling charges and errors, this is the way to go," asserts Bob Shields, IPNet's director of marketing.

Previously, this electronic information traveled through intermediary value-added networks, or VAN lines, which drove up the cost of online business transactions. Not only does EDI enable cost-effective online payment and billing, but it can perform point-of-sale product registration and process all manner of paperwork. This system is so effective that major contractors, including the federal government and GM, have set deadlines by which their business partners must be able to handle EDI transactions.

IPNet's EDI prowess recently landed the firm an impressive deal with the home video game giant Nintendo of America. The technology for Nintendo's online product registration program-in wide use by large retailers such as Wal-Mart, Sears, Target and others-is too expensive for smaller partner-retailers selling Nintendo products. "Nintendo seeks 100 percent participation from its retailers for this program to be effective," comments Willis. "Our Internet EDI solution provides the low-cost flexible solution that makes this participation possible."

Excerpted with permission from Small Business Success, Volume XII, produced by Pacific Bell Directory in partnership with the U.S. Small Business Administration.