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The merchant should NOT have run the promotion at a LOSS. The promotion should have been at least break even, if not slightly profitable.
by dailo10 16y ago
The merchant should NOT have run the promotion at a LOSS. The promotion should have been at least break even, if not slightly profitable.
- maukdaddy 16y agoMerchants run promotions at losses all the time. What the merchant should have done was set a cap at the dollar value of the loss they were willing to accept. For example, I'm willing to lose $2000 therefore I will sell only 200 groupons.
- brk 16y agoThis is a nice statement to make, but how do you propose they could have done that? Groupon seems to demand at least a 50% discount on normal prices, and then seems to want to take between 50 and 100% of the actual groupon coupon cost. That leaves the merchant able to collect somewhere between 0 and 25% of their standard pricing. Other than software businesses, there are few few shops that have enough of a markup to be able to sell something at 25% of face value and still make money on the product itself, much less cover all the additional overhead.
- hugh3 16y agoWell then, I guess they shouldn't have used groupon, if groupon is only good for drawing in customers by extreme loss-making activities. Bashing your head against a brick wall hurts, but the solution isn't to find the least painful brick, it's to stop bashing.