How to turnaround a dot-com retail failure

Seth Greenberg saved eHobbies.com by getting down to retail basics. He decreased the payroll from 250 to 3, and moved from swank offices to the warehouse. The online retailer was profitable with 2 years and is now back up to 20 employees and 75,000 products.

Hobby shops traditionally are hard to make profitable because the of the sparse population of hobbyists in any one location. On the other hand, it's a natural industry for online sales because eHobbies can aggregate shoppers nationwide and around the world.