BE WARY OF TAOBAO GROUP BUYS, SOME ADMINS JUST OUT TO MAKE INDECENT PROFITS

Dear All Singapore Stuff,

Be wary of joining GB (Group Buys) from Taobao groups on Facebook.

To begin, you may or may not want to believe what I will be writing below. But nonetheless, I've taken some time to pen it and it's really up to you. There may be some lingo used that only people who have bought from Taobao before will understand but generally, the purpose of this post is purely to raise awareness to the general public, letting them make informed decisions and of course, save money! The intent is and never will be to slam and/or condemn all Taobao groups on Facebook, well, except for some questionable group.

First of all, most of us have all heard of Taobao - China's answer to Amazon in the US. Basically, almost everything that you can think of that is made in china can be found on Taobao and buying from Taobao allows you to save quite a significant sum of money rather than buying from retailers here since you are somewhat buying direct from the source. Recently, even our Malay and Indian friends have also started joining the Taobao craze. Well, if you knowhow to buy from Taobao and get it shipped to you on your own, like myself, congratulations! For those who have no confidence with reading mandarin or have no idea how to ship items on your own, you have a few options:

One, engage the service of a forwarder like 65Daigou, SGshop etc... Their websites are in English and all you need to do is to provide the link of the item and these forwarders will buy on your behalf and get it shipped to you; with an agent fee of course, but prices are all listed and transparency is there.

The second option is to join a GB (group buy) organized by people in the numerous Taobao groups you can find of Facebook. The intention of a group buy, is to gather a number of interested buyers to buy in bulk and ultimately save on costs like shipping, bulk discounts, etc. However, the admins of this particular group of mention have the sole intention of making (big) profits from organizing such group buys. How do I know? Someone I knew challenged the group's admin on the GB price of a particular item, almost immediately, he was kicked and banned from the group. No reason was given its quite obvious why he was kicked and banned. I did a simple check with other members with other Taobao groups, and it seems like he was not the only one. Everyone and anyone who posted links of the same item with a cheaper price tag, or questioned the GB price of items, has been kicked and banned. Its obvious that these admins want to protect their money making GBs which they try to pass off as "save on shipping thru GBs" to unsuspecting members. Below are just of the few examples on how their little money making trick/scam/scheme work:

1) After poking around a bit, it seems there were many other cases as well, I have heard of 1 lady whom wanted to "tompang" their shipment with these admins. Her items were like just 7 or 8 small items, and the "tompang" fees quoted to her was close to S$100 via sea. Even idiot would also know that S$100 or S$110 can allow you to almost ship an entire 1 cbm @500RMB per cbm. So much for "tompang" huh? Last I heard, the lady made a fuss and threatened to forgo the shipment after paying the S$100 and the admins "gladly" refunded her S$50, which, IMHO, is still expensive.

2) As mentioned before, someone I knew recently questioned on the price of a particular item, an umbrella, which got him kicked and banned. From what I heard, the cost of the umbrella on Taobao is RMB 88. The price offered for members interested to join the GB was SG$59.90 per umbrella. Now even though they mentioned SG$59.90 was "all in", inclusive or credit card charges, GST, whatever tax, handling fee, and including local courier delivery to your door step, you do do the math. RMB 88 converts to about SG$20, how on earth does shipping and all other fees come up to SG$40? It simply doesn't add up. First off all, they said credit card fees are included which is 3% of the Taobao transaction. S

ince they collect cash payment from members first before the GB proceeds, they should have the cash, so why is there a need to use credit card? eNets (direct bank transfer thru NETS) can be used which has a service fee of just $1 per transaction regardless of the transacted amount. Secondly, they mentioned that umbrellas are bulky and require sea shipping which is BS. The reason why they say ship by sea is because all goods shipped by sea, regardless of the price is being subjected to 7% GST by customs, which can be used to push up the GB price. I asked around and people have shipped the exact same umbrellas via 4px air as they fall within the maximum dimensions allowed by 4px air. Furthermore, goods shipped by air are only subjected to GST for purchases in excess of SG$400. Having said that, if the GB was really so big, a more cost effective way is to split the air shipment to prevent GST from being charged.

I have also taken the liberty to ask around and people who have shipped the exact same umbrellas via sea mentioned that each umbrella is only like 0.03 or 0.04 cbm (cubic metre) which translates to like S$4 or S$5 for sea shipping @500/550rmb per cbm. Next, local courier service, at the most give you $10 to deliver island wide, unless you use helicopter? Lastly, a check on Taobao showed that the exact same umbrella was sold by another seller on Taobao for RMB 49 only and they most probably could have quoted people RMB 88 and ordered from the cheaper seller. So, from this, simple math will tell you how much profit those admins are making. No doubt you will want to earn some handling fee and that is ok to most people if you make it transparent. However, an umbrella which costs RMB88 (or even RMB49) and you happily charge people SG$59.90 for each umbrella. Thats absurd. My guess is that they have a bigger shipment of their own, and the profits from this GB will somewhat give them free shipment costs for the entire shipment.

3) More recently, after talking to another friend, whom was also kicked from the group for posting links of item with cheaper prices. She mentioned to me that a number of people she knew, whom like me, was also kicked when questioning the price of GB items. With the number of GBs these admins organize, simple math can tell you that each GB can probably earn them bag them a 1-2k profit, and not to mention free shipping for themselves. No doubt they mention things like only join if comfortable with the price, etc, but its obvious they are taking advantage of those whom do not know the cost of shipping, and if there are any actual discounts given by the seller for bulk purchases.

4) Oh and even more recently my friend found out that he was kicked and banned for being "irritating". Yeah, i guess he irritated their money making scheme. LoL.. He mentioned that he has like 20-30 mutual friends inside that group, so yeah, kick them all lah?

So, fellow Taobao-ers, do keep your eyes open when joining these so called GBs organized by this particular group. Know what you're buying and do your sums correctly first before joining, otherwise you may end up paying more than you should and making someone else happier and fatter. Do not be afraid to request for pricing transparency like questioning the price of the item and request a breakdown of the shipment costs and whatever fees, and if they don't give, don't join. Well, and if you get kicked or banned, then it only just proves my point. Also do remember there are also many other Taobao groups around in Facebook who truly organize GBs to help everyone save money instead of taking us as carrot heads and trying to rip us off.

Happy Taobaoer
A.S.S. Contributor