ENDLESS AISLE'S END SURPRISES RETAILERS

STEPHANIE FAGNANI

NORTH BRUNSWICK, N.J. -- Retailers feel as if they've been left holding the virtual "bag" after online service provider NeXpansion ceased its "Endless Aisle" program due to financial burdens.

Nearly all of the 20 or so participating retailers had notified their online shoppers of the discontinuation of the program. The service was available to them primarily as a link between the retailer's home page and the NeXpansion page.

According to industry sources, a small liquidation team is all that remains at the company, based here, while the company seeks financial options.

Retailers liked the concept and expressed disappointment, describing the Endless Aisle idea as a nice complement to their brick-and-mortar offerings. Syracuse, N.Y.-based Penn Traffic called the program "Specialty Shop Online," and made it available to consumers in all four of its banners: Big Bear, P&C, BiLo and Quality Markets.

"With NeXpansion's fate uncertain, we've had to suspend operations of that program since they were the ones who supplied the order-taking and fulfillment services and, in that sense, they were operating the back end of the Specialty Shop Online," said Joe Ramirez, spokesman for Penn Traffic. All links to the program have been removed from the company's Web sites, he added.

Winn-Dixie and Shaw's Supermarkets are among other retailers who posted disclaimers on their sites, indicating that the service was no longer available.

"At this point we'll probably have to continue the way we used to do business for a hundred years before online and have to try to fulfill the requests of the customer the best we can until something comes along down the road," said a top-level executive from an East Coast retailer who declined to be identified.

Launched in the summer of 2002, NeXpansion's main claim to fame was helping shoppers locate unique and hard-to-find groceries, and then delivering them directly to their door. The company began in 1996 as Netgrocer.com. Company executives did not return phone calls from SN.

Ramirez said Penn Traffic picked up the service in May this year after conducting pilots using in-store kiosks to test the concept of computerized shopping. The East Coast retailer said his chain had been participating in the program since January of this year and, while it wasn't a huge part of their operations, it did provide a service to consumers. "We couldn't take any chances on our end with the customers and we just took it right off our Web site -- we wanted customers to know it was an outside service," he said of the shutdown.

While Penn Traffic had received a positive response to the program, it was still too soon to determine its long-term standing, Ramirez said. He added that he is unaware of any alternative to the Endless Aisle concept at the moment, and therefore would not speculate on what Penn Traffic might do to replace the online service.