IFLY - travel sales on the web pure play Message Board

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Technology Stocks : IFLY - travel sales on the web pure play

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To: ajunkh who wrote (1049)	5/7/1998 5:11:00 PM
From: LAWRENCE C.	Read Replies (1) of 4761

Profit margins play a big factor in internet transactions. If IFLY runs into trouble with generating a profit on internet transactions, due to a low cap on internet transactions this affects the potential future profits estimates considerably. How many internet transactions will they need to break even and what profit margin per transaction they can generate becomes very important. 1) Will they need 1 million, 10 million or 100 million transactions to break even? 2) Will they make money per transaction? Certainly they hope to or you wouldn't have companies like IFLY planning to enter the internet market. 3) How much profit will be generated per internet transaction above the breakeven point? .01, .05, $1, $2, $5, more than $5 but less than the $10 cap 4) What are the cost and profit equations? 5) How long will it be before we have a better internet site? 6) What will our market share be? 1%, 2%, 5%, 10% or more Existing airline sites are already establishing brand loyalty and market share and profits (??). The airline sites have a competitive advantage. They can gear their systems to see their unsold seats real time and adjust the price near real-time depending on propietary info. If profitable, other airlines will market their seats directly in competition with non-airline sites. So you have the non-airline sites fighting for the remainder of the pie. Will IFLY generate enough market share on the internet to be profitable on the internet? That depends on potential profit per internet transaction. 7) If internet transactions are extremely profitable, there will be more companies trying to enter the field. These are some of the questions that affect the growth potential. Big difference Lucky Lawrence

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