#tuangou

[antitude-blog]

快餐团购加递送

每天提供两种午餐， 找专门不同特点的厨师来做，然后提供免费的快餐递送。快餐的费用经济实惠，菜品干净健康，每天主题不同，请不同类型的厨师

建立社区允许用户投票，胜出以后，网站会找专门的人做出来然后在网上卖

[chinagrouponclone-blog]

Hey Group Buying analysts, remember Econ 101?

“Stop. Relax. Breathe.”(1) Group buying just began in earnest in the US in 2009 and in China in 2010. The market is anything but mature and therefore the pricing to consumers and the pricing to merchants is likely not in equilibrium. More competitors will come, some will go, some will combine, and others will provide new services and offerings. This is natural.

It is surprising that most commentators on Group Buying don’t mention this front and center. You often hear, “Merchants will not be able to make money at 50% split on 50% off with only 20% of customers returning. Group buying is dead.” Fine, but they would make money at 100% of the split with no discount, right? But then there would be no customers. So somewhere in the middle, my friends, lies an equilibrium.

This is a big risk for Groupon, and something they do mention clearly in their recent S-1 filing. If the payment terms or the split with merchants change, Groupon’s business could be impacted significantly. In China, we see margins of ~10% with local service deals. Some competitors (namely Lashou and other big funded players) will take 1% or less on a deal! But the discounts in China are bigger, so the long term story for the merchants may still be a rise in price and a reduction in demand. So the craze will soften and the industry cool down. So be it. It’s the market.

In order to look at this quantitatively, we have created a mini model that takes existing assumptions and models out the profitability of a typical merchant under various discounts, revenue splits, % customers returning, and more. The bottom line? Merchants can make money under reasonable assumptions, but not with the 50/50 (discount/split) we are currently seeing. We see no strong reason to suspect the quality of Group buying customers will change anytime soon. Consider the following chart, and please feel free to download the model, play with it yourself, and post your own conclusions in the comments.

In the US, studies have shown customers repeat at 20%. Assuming 40% merchant COGS implies that ultimately Groupon margin should be around 35%, less than Groupon's often quoted 50%. Of course different businesses have difference COGS, customer behavior, and other factors to consider.

Note 1: These outputs assume 50% discount to consumer.

Note 2: Adjusting the model to 30% of original price makes requires <= 30% restaurant COGS to be profitable (again, at 20% repeat customer rate).

Note 3: This does not include extras purchased by customers in visit, although the % repeat could be adjusted to include these extra sales.

Even in communist China we can’t (yet) force our merchants to take our deals. Less than 1/5 of merchants we pick up the phone to call will field the call, much less do a deal with us. So Group buying is not dead because the majority of current Gorupon merchants don’t make money. It just means that when the long line of merchants eager to work with Groupon has run down, payment terms will change.

Then Groupon will be less profitable, group buying customers will be fewer, and the Andrew Mason star will shine a little less. But at least within the next 5-10 years, I would be surprised if it went out for good.

Where do you see the economics of Group buying headed in the US? In China? Please discuss its viability in the comments.

(1) Quote from Mark Zuckerber to Facebook users, circa 2007 when newsfeed first came out and users revolted.

(2) Email us at Chinagrouponclone at gmail dot com if you would like to take a look at the model.