---
title: "Community Group Buying Raises 4.5 Billion in 4 Months... The Second Half of the 'Hundred Regiments War' Begins! Is It a Dish for the FMCG Industry?"
description: "Around 2011, internet group buying emerged, attracting over a thousand group buying websites, historically known as the 'Hundred Regiments War' or 'Thousand Regiments War'. It ended with most platforms exiting or going bankrupt. This year, the 'Hundred Regiments War' seems to have a second spring as community group buying suddenly becomes popular, with countless merchants eager to gain a share through social e-commerce in the terminal living scenario of communities. What is community group buying? The current mainstream model is: based on real residential communities in second- and third-tier cities, establish WeChat groups online, recruit community moms, convenience store managers, and courier station heads as group leaders, and publish product pre-sale and group buying information in the WeChat groups. After users place orders, goods are delivered to the community, and users pick them up at offline pickup points to complete the transaction. Platforms provide brand, technology, supply, logistics, and after-sales support."
author: "New Distribution"
publisher: "New Distribution"
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published: "2018-12-21"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/ynIzNIi1j9zkbThMu7Niig"
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# Community Group Buying Raises 4.5 Billion in 4 Months... The Second Half of the 'Hundred Regiments War' Begins! Is It a Dish for the FMCG Industry?

> Around 2011, internet group buying emerged, attracting over a thousand group buying websites, historically known as the 'Hundred Regiments War' or 'Thousand Regiments War'. It ended with most platforms exiting or going bankrupt. This year, the 'Hundred Regiments War' seems to have a second spring as community group buying suddenly becomes popular, with countless merchants eager to gain a share through social e-commerce in the terminal living scenario of communities. What is community group buying? The current mainstream model is: based on real residential communities in second- and third-tier cities, establish WeChat groups online, recruit community moms, convenience store managers, and courier station heads as group leaders, and publish product pre-sale and group buying information in the WeChat groups. After users place orders, goods are delivered to the community, and users pick them up at offline pickup points to complete the transaction. Platforms provide brand, technology, supply, logistics, and after-sales support.

Around 2011, internet group buying emerged, attracting over a thousand group buying websites, historically known as the 'Hundred Regiments War' or 'Thousand Regiments War'. It ended with most platforms exiting or going bankrupt.
But this year, the 'Hundred Regiments War' seems to have a second spring. Community group buying suddenly becomes popular, with countless merchants eager to gain a share through social e-commerce in the terminal living scenario of communities.
What is community group buying?
The current mainstream model is: based on real residential communities in second- and third-tier cities, establish WeChat groups online, recruit community moms, convenience store managers, and courier station heads as group leaders, and publish product pre-sale and group buying information in the WeChat groups. After users place orders, goods are delivered to the community, and users pick them up at offline pickup points to complete the transaction. Platforms provide brand, technology, supply, logistics, and after-sales support.
Compared with traditional offline stores, community group buying saves rent and labor costs, uses a pre-sale model, and produces based on sales. Compared with traditional e-commerce, community group buying can deliver directly from origin, factories, or large transit warehouses to communities, with the last mile handled by group leaders or self-pickup by consumers, reducing per-order fulfillment costs.
Capital seizes the 'community' entrance, community group buying becomes hot
△ CCTV Finance "Economic Information Broadcast" program video
Ms. Gong, who works in foreign trade in Shenzhen, is a freelancer. Now, she works from home most of the time, and she buys fruits and vegetables through a community group buying platform every day.
Ms. Gong, a Shenzhen citizen: Recently, we have grouped for rock sugar oranges and green vegetables. The price is much cheaper than outside fruit shops, and they are very fresh.
Ms. Gong told CCTV Finance reporters that the community group buying platform she joined delivers goods the next day after ordering.
Yao Dengzhou is a community group buying leader in Shenzhen. When reporters met him, he was delivering group-bought goods in the community that day.
Yao Dengzhou, a community group buying leader in Shenzhen: Milk, fruits, rice, etc., because neighbors need these things every day.
According to incomplete statistics, in most community group buying projects, fresh products account for more than 50%. Community group buying leaders like Yao Dengzhou generally only earn commission service fees, and behind them, teams specializing in product supply chains are responsible for product procurement. Because community group buying has large centralized procurement volumes, distribution logistics costs are also effectively reduced.
Community group buying has low customer acquisition costs and high repurchase rates, attracting many internet companies that see its development prospects.
Since August, at least 15 community group buying companies have completed financing, with total financing of at least 4.5 billion yuan, more than the 2.8 billion yuan raised by unattended shelves.
More and more traditional enterprises are also starting to sell products through group buying business models.
The head of a wine trading company in Shenzhen told reporters that since December, as soon as their group buying activities were launched, product sales increased rapidly.
Gao Qingzi, a sales manager of a wine company in Shenzhen: For example, white wine, we now sell it through social platform group buying. In half a month, we have sold about 3,000 bottles. But with traditional methods, it was about 100 bottles in half a month.
Industry insiders say that when the cost of internet traffic acquisition is getting higher, traditional e-commerce also faces problems of difficult and expensive traffic, and social is an excellent entry point. The 'social + group buying' model allows products to be actively presented to new consumers, stimulating many potential market demands.
Hua Tao, executive president of Shenzhen Retail Business Association: A single variety or single product has large sales volume, so its cost can be reduced, and its gross profit can be well guaranteed.
Social e-commerce user scale exceeds 200 million, practitioners exceed 30 million
△ CCTV Finance "Economic Information Broadcast" program video
From 'social group buying' represented by Pinduoduo to the rapidly rising 'community group buying', the retail industry's model changes are so fast that people are caught off guard. Driven by community group buying, more and more entrepreneurs are joining.
Ms. Yu, born in the 1990s, is used to shopping through group buying in her life. Seeing the popularity of community group buying, she plans to open a community bakery and sell cakes and other baked goods to the community through group buying.
Ms. Yu, a Shenzhen citizen: I think the community platform should be a good and time-saving promotion, so that more energy can be put into making cakes.
Like Ms. Yu, more and more entrepreneurs are optimistic about the development opportunities of social e-commerce.
Zhu Haifeng is the head of a baking training institution in Shenzhen. He told reporters that compared with traditional offline stores, current community group buying platforms mostly use a pre-sale model, producing based on sales. Community group buying allows products to reach consumers directly, reducing intermediate costs.
Zhu Haifeng, head of a training institution in Shenzhen: In recent years, we have graduated nearly 80,000 students, and a large part of them have opened stores in communities. They may have WeChat business. Now, each campus is basically scheduled for classes one to two months in advance.
Data shows that in recent years, the scale of 'group buying' e-commerce users has grown rapidly. In 2017, the scale of group buying e-commerce users in China exceeded 200 million, with a growth rate of 117.5%.
In 2018, the scale of group buying e-commerce users in China exceeded 300 million, and will approach 500 million in 2020.
The "2018 China Social E-commerce Industry Development Report" shows that the scale of social e-commerce practitioners in China is expected to reach 30.326 million in 2018, with a growth rate of 50.22%.
Hua Tao, executive president of Shenzhen Retail Business Association: Originally, we needed to sell our labor, that is, join a company or an institution, receive a salary, and then combine with production materials through that company. Now, because of technological development, we can combine with production materials without joining a company or receiving a salary.
In the chaotic community group buying, who will be the winner and who will be the king?
This time, how will the 'Hundred Regiments War' end?
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