Group Buy Fund

Start your Group Buy threads here for anything pertaining to the M100

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Group Buy Fund

Postby cliff » Sun 13.07.2014, 01:08

I did mention this on another thread but I feel it needs wider discussion. As we have come out of the dark times that almost wrecked the concept of the group buy, (02 ABB anyone? Anno Domini seemed to work for a long time. :D )

I think it is time for a "Group Buy Fund".

Having neither the time or resources to arrange a group buy, I have nothing but the utmost respect for those who do, however I think that there must be a better way than individual members funding everything themselves. How about:

We all contribute a small amount to be held by LEC, this is used to fund the initial costs of setting up a group buy. Once the group buy is up and running, the money is put back into the fund for the next time.
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Re: Group Buy Fund

Postby lotos » Sun 13.07.2014, 05:07

Forgive me - but I'd like to add my two cents. This concept seems flawed for a few reasons:

1) Group Buys can require very large sums up front (which I assume is what prompted the formation of this concept). That means LEC will be holding hundreds, perhaps thousands of dollars perpetually, from members throughout the planet? Is the deposit log to be kept public on the forum? Who is the treasurer?

2) Doesn't this scheme mean that only one group buy can go on at one time, since the funds will be allocated and not available to other buys? And seeing as they often take many many months or years to go from concept to delivery, when is the money allocated and when is it returned to the fund?

3) Who decides what project gets funded and what project doesn't?

4) Isn't it preferable for Group Buy Creators to request funds at the start of a given project (i.e. a refundable downpayment or deposit from prospective buyers) ? That would avoid all the pitfalls I thought of above.

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Re: Group Buy Fund

Postby Brit-Car-Nut » Sun 13.07.2014, 15:17

I thought we all learned from the previous pre-paid and failed projects.

There is no simple way to do a project that will cost thousands of dollars or pounds up front without the developer laying out his or her personal money toward that goal.

Announcing the beginning of a project usually provided a list of people announcing their desire to buy the item being made. Based on that list, decisions as to pricing and quantity are made.

With some projects running well over a year to complete, many cars have changed hands so those buyers are gone and others have scrounged other solutions since they couldn't wait - I really do understand not being able to wait for some things.

The big issue is that if the buyers go away during the time it takes to engineer and manufacture the item, then the pricing structure results in a financial loss to the project developer.

So, what is the incentive to encourage anyone to jump into something like that? The only answer is "Love of the car and the desire to help others keep their car as original and functional as it was when originally sold".

Losing $5.00 here or giving up hours of time there is easy to do and not harmful, but putting up thousands of dollars to have something made, pricing it to everyone from the beginning based on stated demand only to have the demand diminished by as much as 50% means the sales will never cover the costs. Neither Wayne nor I have ever raised the originally promised prices for the items we "found" or had made. Guess what? Neither of us has broken even much less made a profit in any of the items for sale.

Wayne has never complained but I tried to make everyone aware that failure to recover the investment in a BIG project was not much incentive to do any more.

I know I have upset a lot of people including the MODS but I don't think anyone understands the reality. I guess nobody believes anyone would put together a project that didn't make a profit. We have always based the pricing on the demand and when the demand has been reduced over time, the losses really can add up. Anyone that says"I want that" in a list and then jumps over to another option mid way is certainly allowed, but they just helped the original developer lose money.

For me, it has become simple. Bail out of the projects I started and just finish my own car and stop trying to help anyone else. Sucks, doesn't it...
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Re: Group Buy Fund

Postby theelanman » Mon 14.07.2014, 11:33

Brit-Car-Nut wrote:For me, it has become simple. Bail out of the projects I started and just finish my own car and stop trying to help anyone else. Sucks, doesn't it...

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