GLS Global Assets Ltd. (GLO)
Interview with:
S. Cedric Steele, President and CEO
Business News, Financial News, Stocks, Money & Investment Ideas, CEO Interview
and Information on their
software that enables the user to create a fully functional eStore in 5 easy steps, without the use of a web designer or programmer.

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GLS Global Assets Ltd new product, eStorebuilder 5.0, provides small to mid-sized companies the ability to create an online virtual store at very low cost with a user-friendly environment

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Technology
Internet Applications Software
(GLO – TSX venture)

GLS Global Assets Ltd.

Ste. 402, 1208 Wharf Street
Victoria, BC, Canada V8W 3B9
Phone: 250-388-6258




S. Cedric Steele
President and
Chief Executive Officer

Interview conducted by:
Lynn Fosse
Senior Editor

CEOCFOinterviews.com
May 2003

BIOGRAPHY – S. CEDRIC STEELE                                  September 26.2002

Mr. Cedric Steele is President of Cedric Steele & Associates Ltd., a commercial real estate company, which he founded in 1972. He was licensed as a realtor in Vancouver in 1968. He has been President of GLS Global Assets Ltd., a publicly listed company, since 1985. The company is involved in a number of technology enterprises. Mr. Steele owns and operates Prospect Lake Golf Course in Victoria, which was purchased in 1974.

Mr. Steele has been very involved in the real estate industry.  He was Chairman of the Commercial Real Estate Division of the Victoria Real Estate Board and also served as Secretary/Treasurer in 1982. In 1988, he founded Global Listing Service, which was a worldwide real estate network. During 1983, he completed the Mortgage Lending and Brokerage course at the University of British Columbia. He also completed the Canadian Securities course in 1985.

Mr. Steele has been very active in community endeavours including President of the Stanley Park Kiwanis Club of Vancouver, President of the Greater Victoria Chamber of Commerce in 1980, Chairman of the Board of Governors of Glenlyon-Norfolk School, Chairman of Corporate Fund Raising for Timmy’s Telethon, Board member of the Queen Alexandra Hospital for Crippled Children and he served six years as a member of the Victoria Police Board. Mr. Steele also served on the Executive of Tourism Victoria and was Chairman of the Environment Committee. Mr. Steele served on the Executive of the Advisory Board to the Faculty of Business at the University of Victoria for five years.  He is an Honorary member of the Alumni Association of the University of Victoria.

During March 1996, Mr. Steele was invested as a Knight of St. John of the Sovereign Order of St. John of Jerusalem, Knights Hospitaller. In June 2000, he was promoted to Knight of Grace.

Mr. Steele has been involved with the Canadian Forces Liaison Council since 1994 and has been promoting a closer relationship between the business community and the Armed Forces.

During May 1997, he was appointed an Honorary Naval Captain. There are currently ten Honorary Captains in Canada. He was awarded the Navy and Marine Corps Achievement Medal by the United States Navy in 1999 and then a Gold Star in lieu of second award in 2000 for his work with the aircraft carriers USS John C. Stennis (CVN72) and USS Abraham Lincoln (CVN74).

During 1998 he was appointed as a member of Revenue Canada’s Pacific Region Small Business Advisory Committee.  In February 2001, he was appointed as a member of the National Small Business Advisory Committee of Canada Customs and Revenue Agency.

During 2001 he was presented with the “Spirit Award” by the tourism industry for assisting in the expansion of the opportunities for the industry by helping to arrange U.S. aircraft carrier visits to Victoria.

In April 2002 he was admitted as a Serving Member of the Most Venerable Order of the Hospital of St. John of Jerusalem.

During the same month, he was appointed as the Honorary Consul of the Republic of Latvia for British Columbia.

He was the Honorary Chair of the Bell Walk for Kids in Victoria, which raised funds for the Kids Help Phone, a National organization with a $10 Million annual budget, which was held in Victoria on 5 May 2002.

Company Profile:
 
GLS Global Assets Ltd. (GLO – TSX venture) is an innovative software solutions developer, providing applications targeted toward giving business the ability to take advantage of the constantly changing opportunities provided by the internet. GLS Global Assets Ltd. continues to expand and explore further opportunities in the emerging interactive and media markets. They empower businesses by providing an affordable way to access the global market with eStorebuilder 5.0.

GLS software enables the user to create a fully functional eStore in 5 easy steps, without the use of a web designer or programmer. An eStore is an e-commerce website built and managed using eStorebuilder's unique ecommerce software, which allows businesses to accept credit cards in a secure fashion or an electronic email order. Use the Setup Wizard to create your eStore, an online catalog and add products, information, print Order Reports and Manage your eStore with the comprehensive management tools. Additional eStore features include: assign user discounts, B2B and B2E compatible, detailed sales report and easy maintenance. Passwords levels can be assigned for employee designations, online FAQ and help, it supports multiple payment gateways and SSL Security is embedded.

CEOCFOinterviews: Mr. Steele, please give us some background on GLS Global.

Mr. Steele: “The company has been in existence since 1977, when it was originally listed on the stock exchange here in Vancouver. Then a group of us took it over in 1985 and we started doing some technology projects in the company. The acronym GLS stands for Global Listing Service, as we had the first worldwide real estate listing service that we established in 1988. About three years ago, we became very interested in the e-commerce sector and we took over a company that had developed a program for a large telecom company that got into trouble. We brought the product into Canada, we completed the e-commerce project and we are now ready for the market place.”

CEOCFOinterviews: Will you tell us about the product you are offering?

Mr. Steele: “Our product is called eStorebuilder 5.0. What is unique about this product is that it will sell for $249.00 at the retail stores in a box, which is unique for an e-commerce product. Inside that box there is a CD, on which there is a full manual that one can use to set up a store, but there is also a quick start guide. The moment you install the CD into your CD Rom, you will get three icons. One icon allows you to just add your user name and password and the second icon is for building and managing your store and the third one is to be listed on our e-store directory, which is a worldwide directory. What is unique about the product is that the whole store is built on our servers. It is built online so that anybody with a web browser can access our servers and start building their store. They do not need a web master or someone that is highly skilled in computers because there are 28 templates that a person can use to get the look and feel that they want for their store. If they are anywhere in the world, such as traveling to London or Hong Kong, they can just access the system through the e-store directory (eStoredirectory.com), type in their user name and password and change pricing or do whatever they wish to do with their site. It is built in a very robust fashion so that you can have thousands of products on the system. It is quite unique because of the structure of the system. You can have products, groups and sub-groups, so that you could define minutely what you are looking for from the store. Some people would be using this as a cataloging system of all of their products for sale, so that people can shop from a distance. People have a choice to buy via e-mail or credit card; they fill in the required fields to buy the product and then e-mail the company. A representative would then call and find out the method of payment. Alternatively, they will be able to pay via Visa, MasterCard, American Express or Discover Card because we have made an agreement with those companies, which are managed by Moneris Solutions of Chicago. That is a partnership of the Royal Bank (TSX & NYSE: RY) and the Bank of Montreal (TSX: BMO), which is a seven-hundred-billion-dollar conglomerate. If you are a merchant setting up your store, you can apply for this service online. When you answer the question “would you like to accept credit cards?” you will be able to go right through to their system, fill in the required information and get a merchant account online. What we have done is brought a simple solution to the small and medium enterprise. They will be able to show their products, multiple pictures of their products, and have a very robust system that they can manage themselves without the use of outside technological experts.”

CEOCFOinterviews: Are there similar products available today?

Mr. Steele: “I believe that this is the first one of its kind in the world. There are many other companies selling e-commerce solutions, but I believe we are the first to have such a simple solution with all the necessary components. There is no monthly residual fee charged to the merchant, which most companies do. We actually host the people free of charge on our site if it is built with just our templates. Let’s say that somebody has not had a presence on the internet at all. By buying our product for $249.00 dollars, they can build their own website and then have an e-commerce store and a cataloguing system or accept orders by e-mail or merchant account. We have provided a whole solution where we provide them with their URL and they do not have to go to an outside service to establish a web presence. We host it for free because we will receive a residual income from the credit card companies by way of a share of the transaction, which will help us with the bandwidth. It is a very simple solution that is easy to set up and manage and very inexpensive. There is no further expenditure that the merchant has to face. Obviously this limits the risk that they face because sometimes one hears of horror stories of waiting months and months for a website and a web store and it can cost ten thousand dollars or more. Our product is very inexpensive and easy to use. Additionally, for people with an existing website that would like to do e-commerce, it is very simple to do by adding on a click-through which we can provide.  People are transferred transparently to our system, so that it looks as if the website has spent tens of thousands of dollars developing a back-end system to do e-commerce when in-fact, it has only cost them $249.00 dollars.”

CEOCFOinterviews: How do you get the people to understand that they can do all of this for that price?

Mr. Steele: “We plan to set up e-commerce seminars and teach people about e-commerce with some of our partners. We hope to get a lot of coverage from some of the media, which is involved in the e-commerce field. We plan to work with Chambers of Commerce and Boards of Trade, and get them to distribute information with respect to the product. We hope that people will become aware of how easy this is, through the media and through the other sources mentioned.”

CEOCFOinterviews: Will you be selling through retail outlets?

Mr. Steele: “We have two retail stores handling the product now, and that is on a very local basis. We are also meeting with some of the mass merchandisers; names that you would recognize. We are making proposals to them so that the product will be stocked in all of their branches around North America. We have not signed anybody on that yet as we are still in the negotiating process.”

CEOCFOinterviews: How will you prevent somebody else from replicating what you have done?

Mr. Steele: “You cannot duplicate a CD because each one has a unique registration number and our system only recognizes one store per registration number. If you wish to have four or five different stores, you will have to buy four or five different packages. Secondly, we have spent four years and six million dollars on this product. There are unique aspects that we have built into the product. We think we have probably a year’s worth of lead-time. If somebody were to take the whole concept and try to copy it, we think it would take a considerable amount of time and we hope to be well established in the markets by the time competitors arrive.”

CEOCFOinterviews: What are your challenges rolling this out and how are you ready?

Mr. Steele: “The challenges will be to get the product on the shelves as soon as we can because now people can buy the product online from us and we then ship the product. We must make the public aware of what we have, and then we must get shelf space. That is our biggest challenge. Distribution and awareness are challenges, and the other one will be technical support for those people that are not prepared to read the manual. We will provide them with the ability to ask us questions through e-mail and we will have a back-up system where they can phone our technical support. If we have hundreds of thousands of users suddenly, this will be a challenge and we might have to out-source that division.”

CEOCFOinterviews: Traditionally, many products in this area take off by word-of-mouth; how do you foster that?

Mr. Steele: “We have already seen it spreading very quickly through the small community that we live in. We plan to use connections that we have in the Better Business Bureaus and other organizations. I am a former president of the Chamber of Commerce, and we plan to provide seminars. We will have e-mails that will go out to the members of the Chambers of Commerce and just raise a level of awareness. As we start getting more people online, I think that it will start growing very quickly by word-of-mouth.”

CEOCFOinterviews: Are you targeting Canada first?

Mr. Steele: “We will first target Canada because this is where we are very comfortable. My partner is from the United States and we have a company called B2B Commerce Inc. in Seattle, which is a 100% owned subsidiary. That website is www.b2bcommerceinc.com and people can buy the product directly from there. My partner is starting his marketing from Seattle, meeting with companies like Costco and others. Simultaneously, we are handling these two markets, and then we have a representative going to the United Kingdom in June because we would love to earn 249 pound sterling instead of $249.00 dollars. This is the method in which we will increase our margins substantially. We will be looking for a joint venture partner for distribution over there and we can develop a marketing plan with them and form a company in the United Kingdom, possibly offering a share of that company to the distributor that would be working with us.”

CEOCFOinterviews: Why is this the right time to roll out eStoreBuilder?

Mr. Steele: “I think that timing is something that we have looked at very carefully because our product is so well designed.  One can run vertical markets with this product. For example, if you were in the boating industry, we could have a total market just for boating that could use our products where everybody buys one of the units and then they can do business-to-business with each other in that vertical market. We have just provided a directory for a Better Business Bureau, so that they can list all their members. We are basically using our directory that we will modify for their use and then all of their members will be able to do business with each other and give each other discounts, which will help that organization retain members and gain new ones. As far as the timing is concerned, we have seen the cycles go up and down in e-commerce and the main focus appears to be in the business-to-business sector, which we think is a big market. As we are calling on merchants and doing focus groups, we have found that the merchants are saying “we have heard a lot about e-commerce and the internet, but we have not yet found a solution that is inexpensive that gives us the total package.” I believe that is what we have now. People have had sufficient education on the advantages of the internet and e-commerce so I think the timing is right. For example, Moneris (Visa, MasterCard, American Express and Discover cards) have been looking for a solution that would be between the merchant wanting to go online and the gateway that they can provide. We have this very simple solution to be the conduit that the merchant can use to access the credit card companies, so that people can buy their products.”

CEOCFOinterviews: If you are on the shelf in a major store, does advertising need to go with it?

Mr. Steele: “I think there are two aspects to it. We have developed a very attractive box, so if someone is walking down the aisle they are going to see our product. If they have never thought of e-commerce, this is a box that they will pick up and read all the attributes that we have in the product. We are also looking for some kind of partnership with a major computer company that will embed this product in its system so that if somebody wants to do e-commerce, they can buy an inexpensive computer system with a complete e-commerce solution built into it. As we sell more product, and I hope we will have another round of financing at a later stage, then we are prepared to spend some money promoting it. In the meanwhile, we are looking at free media coverage because of the unique aspects of the product through some of the magazines that write articles for small and mid-sized enterprises.”

CEOCFOinterviews: Are there additional ‘bells and whistles’ that people can get from you?

Mr. Steele: “We already offer things like interactive voice response capabilities because one of the other companies we have an interest in does have that service. For example, if someone is selling an automobile, we could add an icon that would have a voice message on it describing the vehicle and also, you could change that message by calling an 800 number and entering a pin number. Later on we plan to add an auction component to the system, which is very easy to do because we have all that technology and we will eventually add on accounting systems. We did not want to make it too complicated at the beginning. We wanted to start at a lower, easy to understand, method of getting on the internet and doing e-commerce and then we will gradually add all these other components and offer them for a small fee.”

CEOCFOinterviews: Are there still many businesses without an internet presence?

Mr. Steele: “I do not have those figures because I think that market is very huge. I have seen a recent report in Business Week, that MicroSoft Corporation (NASD: MSFT) projected some incredibly high numbers of software purchases that would be taking place. If you look at Business Week online for 4/10/03, the headline reads “With new software and an army of resellers, Gates and Company is launching a massive offensive to target forty-five million businesses worldwide.” They are saying that small and mid-sized companies worldwide will spend 420 billion dollars on technology this year and less than 25% are using the kind of sophisticated applications that MicroSoft is now selling.”

CEOCFOinterviews: So it sounds like you have a vast market!

Mr. Steele: “I think it is huge market because MicroSoft is looking at the opportunities of all these millions of businesses, which still need so much software to make their companies work.   Here we have a very inexpensive solution that I think is the foundation for small corporations to be able to get on the Internet and do e-commerce and take a very small risk. It really is a virtual store, so that if one has an existing retail store, instead of setting up another location elsewhere, you can set up a virtual store through the internet and instead of paying rent, you pay us a small fee and away you go; you have an additional business.”

CEOCFOinterviews: What should potential investors know about the company that is not readily apparent?

Mr. Steele: “I think that we are a small cap company. We have only about seventeen-and-a-half million shares outstanding. The two principals own more than eleven million of those shares. We are just in the growing stage. The company has paid for all of its technology and the burn rate is very low. I expect that in the next quarter we will be in a break-even position, and start making a profit because we have good margins in the product and our residual income will grow exponentially as we get more and more merchants online. The risk is very limited and the stock is trading very inexpensively in the Canadian market, in fact our price today is fifteen cents Canadian, which is just about eleven cents U.S. I think the benchmarks that the investor has to look for, knowing that this is a high-risk investment, is whether we are able to sign one of the big major mass distribution companies. If we can find one of those that can give us tens of thousands of unit sales, that will show a huge cash flow for the company and then I think it will pay off very well in dividends for shareholders.”


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