Group Buying: China Style

Even though this blog is not about consumer buying habits or strategies, I can't resist posting a link (subscription usually required, but it was free for me in this case) to this story in The Economist about how groups of Chinese consumers -- in some cases in the hundreds -- are literally ganging up on shop-holders in person to negotiate down prices on retail items. The article describes how "Tuangou, or team buying, aims to drive unprecedented bargains by combining the reach of the internet with the power of the mob. It is spreading through China like wildfire. Getting a discount is also a sort of insurance policy against ending up with badly made or fake goods from Chinese shops." Perhaps the best lesson here for companies sourcing from China is to see first-hand what savvy negotiators the Chinese are -- even when it comes to small consumer purchases. Above all, it's important to remember that despite the past century, the Chinese are a trading people, and they've been at it just as long -- if not far longer -- than the West.

Jason Busch

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