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<p>Elgrande.com (<a href="http://www.elgrande.com" title="http://www.elgrande.com">http://www.elgrande.com</a>) is the first of a new e-commerce<br />
category, the first true "disintermediator". Disintermediation is the<br />
bypassing of the middle layers (distributors, brokers, warehousers and<br />
retailers) of the traditional retail supply chain and eliminating the<br />
retail markup.</p>
<p>Creating the New Model for E-commerce<br />
Information technology research firms, such as Gartner Group, Jupiter, and<br />
Forrester Research, predict that the face of e-commerce will give way to a<br />
new model based on disintermediation. They also predict the emergence of<br />
independent consumer information corporations (much like Elgrande) which<br />
will offer consumers unbiased and extensive information on products they<br />
are planning to purchase.</p>
<p>The Gartner Group has predicted that the highest growth potential in<br />
e-commerce lies in boutique or specialty sites, which Elgrande is ideally<br />
suited to service. Elgrande can take the lead in key niche markets such as<br />
textbooks, professional and technical books, foreign language, alternative<br />
music, etc.</p>
<p>More Like Yahoo Than Amazon<br />
Elgrande has invented and established a group of technologies that is<br />
collectively known as the Shop Engine. The Shop Engine is a group of<br />
software programs that enables retail consumers on the World Wide Web to<br />
purchase products directly from manufacturers without the necessity for a<br />
retail storefront. The products are provided by third party manufacturers<br />
or their primary fulfillment center, at or near wholesale pricing.</p>
<p>Elgrande shoppers will be able to keyword search according to subject,<br />
author, manufacturer, ISBN, description, price, etc., or browse through<br />
hierarchical directories logically grouped by subject (similar to Yahoo).<br />
Elgrande also will provide consumers with a wealth of buying information<br />
enabling them to make more informed purchases.</p>
<p>As an independent consumer information service that functions as a third<br />
party aggregator of product information, Elgrande will provide a virtual<br />
catalog of the world's largest product information database.</p>
<p>Eliminating Bricks & Mortar and Inventory By only handling the data and not<br />
the products themselves, the cost to Elgrande to list a product on its web<br />
site is nominal. This will enable them to have the deepest catalog of<br />
products across all sectors. No niche market will be too small for them to<br />
service.</p>
<p>Offering Limitless Virtual Shelf Space<br />
Elgrande will list products available from many thousands of suppliers who<br />
fulfill orders as they are placed at the Web site. Elgrande will provide<br />
shoppers with unbiased product information, multimedia elements, delivery<br />
options and charges, and the wholesale product prices received from<br />
suppliers. For this service Elgrande charges a flat transaction fee of US<br />
$1.50 per item, which will more than cover the costs of the transaction.</p>
<p>In the first phase of deployment, Elgrande will generate revenues through<br />
the sale of literature, music and videos. These products are shipped to a<br />
global clientele by the Company's Phase 1 primary partner, Baker and Taylor<br />
Inc. Shortly thereafter, the Company will add software and toys/games as<br />
additional product categories. Elgrande will integrate new product<br />
categories as agreements are made with major manufacturers and distributors<br />
in each of the product categories.</p>
<p>Providing Free Access For Suppliers<br />
Elgrande.com offers suppliers a free channel to e-commerce sales. There is<br />
no charge for listing products on Elgrande. Elgrande.com provides<br />
manufacturers the chance to create direct relationships with consumers of<br />
their products. Suppliers have complete control over their product<br />
information on site, including pricing and delivery options. They also<br />
receive free demographic data related to their sales.</p>
<p>Growing Fast<br />
Elgrande began selling books, music, and videos from their principle<br />
supplier/partner, Baker and Taylor Inc, on June 2, 1999. This represents<br />
the commencement of revenue streams for the Company, and sales are<br />
increasing gradually, despite extremely modest advertising. This roll out<br />
encompasses Elgrande's Phase 1 plateau.</p>
<p>Elgrande's Phase 2 rollout, scheduled for Fall, 1999, will see the<br />
initiation of its Global Brand Strategy. A sleeker look and feel for the<br />
web site will be introduced, as well as enhanced functionality for latest<br />
version browsers and higher bandwidth users. At this time, the accumulated<br />
product base of the independent publishers that have signed on will be<br />
introduced, as well as the product categories of Toys/Games and Software.</p>
<p>To date, Elgrande has established partnering relationships with more than<br />
375 suppliers in the publishing, music, video, software, and computer<br />
industries.</p>
<p>International in Scope<br />
Elgrande currently has offices in the United States and Japan, with the<br />
main operations center in Vancouver, Canada.</p>
<p>Japan represents the second largest publishing market after the U.S.<br />
Elgrande has set up a branch office in Tokyo to establish a marketing<br />
campaign for Japan. Initial response from Japanese publishers, as evidenced<br />
at the Tokyo International Book Fair this spring, was very positive since<br />
Elgrande represents a new market at a time when old markets in Japan are<br />
shrinking.</p>
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