• The Wall Street Journal, Tuesday, December 5, 2006 11 AM

The monthly subscription business model that was once the sole territory of print has been reborn on the Web. Greg Shugar, a lawyer, hated tie-shopping, so in 2004 he started a Web site called the Tie Bar, which evolved into a Tie-of-the-Month Club service. For $200 per year, customers who sign up at www.thetiebar.com receive a silk tie each month. The service now has more than 150 subscribers, more than a dozen of which are in their second year. The company designs the ties and manufactures them in China.

For small businesses, monthly services are a great way to keep costs low. They can be add-ons to an existing business model or a primary means of sales. For many, the Web has erased the trouble of owning and operating a brick-and-mortar store.

Monthly subscriptions are a more efficient way of selling goods. Merchants can count on a certain amount of revenue each month, but they also have better control over inventory. They know ahead of time how much material to purchase each month. Club-of-the-month models also let merchants zero-in on certain types of goods to sell rather than offering a wide array of different items. In most cases, the seller picks the item to send to the client.

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