I don't get group buys - help me understand

[BuyPokerChips]

I just don't get it. I mean I understand the underlying concept of pooling purchasing power to get a volume discount. That's a straight-forward concept. What I don't get is:

• What the motivation is for the group purchase organizer, and how it is any different than the motivation for your average chip retailer? I know what they buy them for, and I know what they sell them for, so it's essentially just reselling chips at a different margin and with a different level of service.
• Why these posts about group buys allowed, and almost encouraged, while posts from established retailers shunned?

Furthermore, what I would really like to understand better is why people participate in these (if, infact, they even do). I understand it's grounded in enjoying a volume discount - no argument cheaper is better, all things considered. But how much cheaper is it on average? And does this discount justify any tradeoffs group buy praticipants must make?

So let's say you're buying 500 real clay chips in a group buy. Pricing varies, of course, but for example let's use the pricing of this current group buy which would come to a little over $480 for 500 chips, shipped. Now, if we compare this to the average full retail price for a 500-chip set of high-end clay chips shipped (probably about $575), then there is a "Group Buy" savings of $95, or 16.5%. That's the savings. It's almost $100, but of course this is on a somewhat substantial purchase of say $500-$600.

So, my understanding then is that this discount is in exchange for the following trade-offs:

• Paying cash upfront, perhaps a couple months in the case of a customized group buy
• Paying cash (or Paypal) to someone you know primarily by a made up nickname on a anonymous discussion group on the assumption that they will send you something down the road.
• In the event of a customized design - agreeing to buy 500 chips based on a graphic design mock-up that you have little idea of how will look on an actual chip.
• In the event of a customized design - agreeing to a concensus designed chip, or one designed by the group buy organizer, which you have little say over - so essentially it's not really a customized chip, just someone elses design that you get to approve upfront.
• In the event of a customized design - Not having the ability to add to your set or replace lost or damaged chips down the road because it's a one-time event.
• Assuming the risk that the final prices could change and you're already somewhat pot committed as you've already paid the bulk of the purchase price
• Assuming the risk of a fradulent group buy.
• Giving up any degree of customer service in the event that their is a problem with the merchandise and/or the shipment gets lost in transit
• Giving up the ability to return a purchase for a full refund
• Giving up the convenience and security protection provided by paying with a credit card

So to go thru with a group buy (which are not just on poker chip boards, but on any product-specific board on the web), participants are willing to make all of these trade-offs to save 10-20% (roughly 16.5% in this instance). This doesn't compute with me. Seems like I'm giving up a lot for a little. Maybe not. Apparently (If these things actually go thru to fruition), there are many people who are more than willing to make this trade-off. Maybe everything goes well and there are no problems. Maybe it's a complete scam. Who knows.

My primary concern is this seems like too good a con for the average confidence man to pass up. Even if the majority of the people doing this are above board, that existence makes room for the con men of the world to swoop in and make a quick buck.

Let's take TenPercenter's group buy of 100,000 Paulson chips "you read that right, 100,000 chip order", on a different board, for example. Now, no offense TenPercenter, I'm not accusing you in any way of running a scam. Rahter I'm just pointing out that if a confidence man was to run a scam, they could do something very similar to what you've done and perhaps walk away with 2 years salary for the average person on this 100,000 chip group buy alone, not to mention replicating this on every product-specific board on the Internet.

Some out there might be saying, wait, TenPercenter already did at least one group buy (on the Pharoah's Club Chipco) and everyone got their chips just fine. So there's no risk right? He's proved himself trustful. Or you could take the perspective that it was just the first step in a long con, one that could really bilk a bunch of people our of some cash, like a 100,000 chip order. After all, why would he organize a 2nd group buy when he already has his perfect chip set from the first buy. Who needs two different sets of chips?

Disclaimer - Of course, I'm a poker chip retailer, so reading this you might be thinking I'm just trying to cast doubt on the legitimacy of group buys to boost my business. You're going to have to trust me on this one, but that's not really it. What I'm trying to figure out is what the motivations are for joining a group buy. I'm in the business of solving problems for consumers looking for gaming supplies. What I'm trying to figure out is if there is a large customer base out there who by the act of participating in group buys is actually screaming:

"HEY, We're willing to make a lot of concessions for a 10-20% discount - including revoking our rights to return an item or get a refund of any kind, including our ability to pay with a credit card, including paying 2 months in advance, including revoking our claim to any form of customer service, including assuming the risk of a last minute price change after we've already paid 2 months in advance, including assuming the risks and hassles of dealing with UPS on any items lost in transit."

If that is indeed the reality, then poker chip retailers (including my company), need to recognize this consumer need and meet it with a solution. That's why I'm posting.

[yeltzen]

I like boobs.

[Deakon]

You said it yourself.......cheaper is better. The only amount of valid concern you present is the issue of trust, but I am confident that this is not an issue. Let me guess, you are a retailer for BPC. So, what is it, are you angry that people are finding ways to get a better price on the chips or is it that the group buys are for Paulsons, WSOP Custom chips, TR King customs, etc?

Can't wait to see someone post a reply that as as much time on their hands as the poster!

[Nate PT]

I didnt real all that but its mainly for pricing, and if there is someone with a good idea for chips (WSOP, Egypitans) why not share it and save some money too??

[BuyPokerChips]

Deakon,

The reality is I'd just like to understand the market better. Our company relies on understanding the poker chip marketplace, and we'd like to get a better understanding of the "group buy" customer segment. Fear is not our motivation.

If there is a segment of the market that is expressing a desire to save 10-20% off retail and is willing to make X,Y, and Z concessions, then we want to know about it. As you can imagine, all of these concessions have a cost of doing business, so without providing them with a sale, the price of that average customer goes down.

Lastly, who do you think can get you a better deal on a group buy - some guy named TenPercenter, or an established retailer?

[fcuk]

Somebody sounds bitter. Not everybody has a great artistic mind, or do they have a head full of great ideas. Group buys are for people who want to buy some nice looking chips, save some cash (which is usualy more than 16%) and have a set of nice looking chips. You can pay with credit card, dont know where that idea come from. Maybe if you chose a better supplier for your clay chips, I would pick up a set from you, but I just hate those modern clays.

[gpc]

I am a part of the TR King dual edge spot group buy. The reason I agreed to it was that it cut my cost in half, the chips will not be duplicated and only a handful of people will have the same chips.

[Fins]

Wow... that's obnoxious.

I'll reread your rant later to see if I have a second impression.

but quickly two things...
(1) COST - Volume savings
16-17%??

Take the Chipco examples 500 on your own to your door = $1.32/chip
Group buy at 75¢/chip delivered is over a 40% savings (Desparados & WSOP)
Group buy at 90¢/chip delivered is over a 30% savings (Egyptians & Suits)

I don't have the exact prices but that's pretty close.

- AND -

(2) COST - No/little retailer markup

I haven't read thru the Paulson group buys yet so I can't comment to those but to lump the others especially the Egyptians in that rant... is ridiculous.

- Fins

[Fins]

Lastly, who do you think can get you a better deal on a group buy - some guy named TenPercenter, or an established retailer?

I've seen your retail prices... I'll take Ten.

- Fins

[Nickmast]

Lets see here:

Modern Clays - $369 + shipping for a 300 set
Paulson group buy- (BETTER CHIP)- $214.78 shipped for a 300 set

I wonder which deal is better??

EDIT- I should probably also say that the Paulson price is based on the discount that Nugzy is providing based on the Casino on net sign up.

[pie taster]

Here are my theories on why they are popular.

1) Internet Economy. The internet is providing consumers with a vast amount of information from which to make purchase decesions. So generally people know what the price of poker chips should be. If people feel they can get a good deal, they are going to do it. People love it when they feel they can purchase something for less than what is should.

2)Ownership. When it comes to customization, espically in a forum, people start sharing ideas and opinions and start getting very interested in the chips that are being designed. Look at the threads for the custom WSOP chips.. it went on FOREVER with people commenting on designs and layouts, to the point that you know had a large number of people with a vested interested in the end product, so of course they are going to want to buy them.

3)All this might be over estimated. You probably know more than anyone else, what is the ratio of straight up chip sales compaired to bulk purchases. You are replying to a forum where people are OBSESSED with chips (and in yeltzen's case.. boobs). This board is probably not a perfect representative of the gaming market. But my guess is that bulk purchases are rather small in comparison to the overal market. And forums like these are good place for that minority to communicate.

[yeltzen]

You need to understand the poker chip martket to better serve your customers, eh?
Well, here's a start - belittling your market doesn't work.
With this gem of a post, you've all but guaranteed that no one from this board will ever buy anything from your company.

[Mr. Meaner]

I personally would not participate in a group buy but that is just me. Don't get me wrong, of course I like to save money but I do plenty of research and shopping before hand and then make an educated decision on where I would buy a product. To me price is only one of the factors that I look at when I buy something and it is acctually further down on my list of important items when shopping. The first thing I always look for is a quality product. Second, on my list would be customer service. Last would probably be the price. If I am satisfied I am buying a quality product and will get great customer service from the retailer, price is the last thing I consider. Companies that thrive in business, usually sell quality products have great customer service and sell for a reasonable price. I have learned over the years if you buy the best products in the marketplacey you will normally be happy with your purchase no matter what you paid for it.

[Todd the Mc]

"HEY, We're willing to make a lot of concessions for a 10-20% discount - including revoking our rights to return an item or get a refund of any kind, including our ability to pay with a credit card, including paying 2 months in advance, including revoking our claim to any form of customer service, including assuming the risk of a last minute price change after we've already paid 2 months in advance, including assuming the risks and hassles of dealing with UPS on any items lost in transit."

Try this on your website as a research project for customer demand. Post an optional price break of 25% and make special note that says, Paypal or cash only, no returns and dont call for us help. See which one gets the most orders. Sorry thats sounds more sarcastic than it is meant but money talks. The savings have been more like Fins said. I have not been on this forum for long but I have yet to hear of a scammer. *Knock on wood*

[ChkDeezNuts]

Hey BPC....let me at least say a little something about your chips.....


Your Modern Clay's are defective.

The archetype's are expensive.

The prices are extensive.

THE BPC family!!!!

DADADADUM.....DADADADUM.......