PurchasePro fires 45

Wednesday, May 17, 2000 | 11:10 a.m.

A Las Vegas e-commerce company that rocketed up to a $175-a-share stock price within weeks of its initial public offering has now cut 10 percent of its work force and seen its stock fall below $25.

Company officials say the meteoric rise of PurchasePro.com Inc. led to the firings because several employees who were hired in a hurry didn't meet corporate expectations. PurchasePro says it remains in a growth mode and will hire more carefully, now that it has better focus with a new product offering.

A product launch by PurchasePro.com unveiled a series of new e-commerce products last week.

Meanwhile, the company closed its Phoenix office, turning that operation into a telecommuting group of seven working from homes.

Chris Benyo, senior vice president of marketing for PurchasePro, said 45 people were fired based on productivity outside of Las Vegas. In Las Vegas, he said there was one transfer and no job losses.

"We're ruthlessly focused on making this a profitable enterprise," Benyo said. "Our problem was we grew so fast that we had a lot of people hired quickly who weren't doing the job."

So, he said, the company weeded out employees who weren't producing. He said PurchasePro remains in a heavy growth mode and will continue to hire people.

The company has told investors it anticipates profitability by the third quarter of 2001.

The company said its actions were a part of last week's launch of three "private label" e-commerce products that bring buyers and sellers together on the Internet.

The three products, called e-Procurement, v-Distributor and e-MarketMaker, focuses on buyers, sellers and sales facilitators, respectively. Each system is designed to put a company's procurement process online within 45 days.

PurchasePro's sales force is finding buying and selling customers as well as a list of facilitators that would use the e-MarketMaker product. One of the earliest users of that system was the Greater Phoenix Chamber of Commerce. The system allows companies or organizations with many selling or buying contacts to receive a percentage of sales for facilitating sales between others.

PurchasePro hopes to beef up its sales contacts with strategic relationships with America Online, IBM, Sprint Corp. and Office Depot Inc.

PurchasePro's stock was trading today at $24.625, down $1.625 from Tuesday's closing price. The stock has fallen since its high of $175 a share in December, about 10 weeks after the company went public.