While SmartBargains pursues IPO, its platform is already primed for growth

As discount retailer SmartBargains Inc. pursues up to $80.5 million through an initial public offering of stock to fund long-term growth, its existing hardware and software technology can already support far more than its current e-commerce needs, the company says in its IPO prospectus.

“We believe that our current hardware and software configuration could support more than three times our current maximum requirements,” the company says in its prospectus, which was filed with the Securities and Exchange Commission earlier this month.

The company’s web site, SmartBargains.com, uses architecture based on Microsoft Corp.’s .NET platform for web and application servers, plus the UNIX operating system for running Oracle database servers. It uses proprietary e-commerce technology to manage its order processing and route orders to fulfillment. Its system infrastructure, including web and database servers, are hosted at SAVVIS Communications in Waltham, MA, and has a record of being up 99.9% of the time, it adds.

SmartBargains, No. 190 in Internet Retailer’s Top 300 Guide to online retailers, merchandises about 7,000 products in 13 categories, buying them from 300 suppliers. It sources 80% of its products from manufacturers and the remainder from other retailers and wholesalers. It uses a 150,000-square-foot warehouse in Hebron, KY, that has enough capacity to meet SmartBargains’ expansion plans for the next three years, the company says. SmartBargains outsources its fulfillment and warehouse operations to UPS Supply Chain Solutions under a five-year contract that started in January.

In other details revealed in its IPO prospectus, SmartBargains notes that 74% of its customers are women with average household incomes of $89,000, and that 62% of customers use broadband to connect to its site.

It adds that it sends out more than 2.5 million e-mail marketing messages each week to an opt-in customer list, and that merchandise featured in the e-mails is often sold out before being posted to its web site.