---
title: "Community Group Buying Surging: A Frontline City Manager's Playbook"
description: "With the push of the internet and capital, the FMCG industry sees a new major trend each year. In 2021, the resurgence of community group buying is reshaping the entire landscape of people, goods, and places. For frontline city managers and distributors, this means存量 erosion and cross-regional competition, forcing them to adapt or be left behind. This article outlines the trends, pain points, and solutions for city managers to proactively engage with community group buying platforms."
author: "许翔 Ryan Xu"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2021-04-26"
language: "en"
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# Community Group Buying Surging: A Frontline City Manager's Playbook

> With the push of the internet and capital, the FMCG industry sees a new major trend each year. In 2021, the resurgence of community group buying is reshaping the entire landscape of people, goods, and places. For frontline city managers and distributors, this means存量 erosion and cross-regional competition, forcing them to adapt or be left behind. This article outlines the trends, pain points, and solutions for city managers to proactively engage with community group buying platforms.

With the push of the internet and capital, the FMCG industry sees a new major trend each year. In 2018, home-delivery e-commerce broke the physical limits of traditional retail; in 2019, the B2B trend made traditional channel players nervous; in 2020, nationwide livestreaming gave rise to livestream e-commerce; and in 2021, the resurgence of community group buying is reconstructing the entire landscape of people, goods, and places.

**-01- Stock Erosion and Territory Plunder: Distributors Must Transform**
For frontline city managers, the impact of community group buying is shared with distributors. Previously, discussions about distributor transformation were common, but the O2O home-delivery business bypassed distributors, led by retailers. Then came the ERTM trend, but with platforms relying mainly on self-operated models, few distributors were engaged, especially small and medium ones. However, community group buying requires high-quality, timely, and frequent fulfillment in every city and township, marking the first time internet platform models truly "tie the knot" with distributors. It's time for distributors nationwide to embrace new retail. Moreover, this channel change has already put distributors in the game, often without their conscious awareness.

**On one hand, existing stock is being seized!** Community group buying reaches consumers more efficiently. Platforms don't hold inventory and allow timely returns, meaning primary sales equal secondary sales; orders are sales. As offline retail channels shrink, this direct-to-consumer channel directly competes for distributors' existing stock.

**On the other hand, cross-regional plunder!** Previously, a distributor handled business in one city or area, and cross-regional sales were prohibited. Now, major community group buying platforms are legitimizing "cross-regional sales" as their nationwide expansion dilutes the concept of "designated areas." Different platforms support different distributors, and trusted professional distributors are expanding with platforms across cities. For example, a Sichuan distributor might open accounts in Hunan and then expand to more cities and provinces. Professional channel marketers who connect with community group buying and gradually achieve multi-city, multi-province, or even nationwide network coverage are emerging!

At this point, local traditional distributors who remain inactive are waiting to be hit! Not only will their existing stock be diverted, but external community group buying distributors will also "plunder" across regions without warning...

**With stock eroded and territory seized, whether distributors like it or not, not joining means no survival.**

**-02- City Managers Cannot Just Watch, Control, and Balance**
City managers face community group buying differently than distributors; their stance may not be proactive. A new channel poses a significant challenge for frontline city managers. For any "worker," "not standing out" is safer than "not making mistakes."

**At least, city managers haven't been forced into the game like distributors, so their attitudes fall into three types: watch, control, and balance.**

When community group buying first emerged, it was controversial: prices were chaotic, manufacturers complained, middlemen complained, and terminals complained. Why? Because the concept of blending online and offline was too advanced. Major platforms entered from the second half of last year and took only 3-4 months to go from 0 to 1, covering in months what other business models took years to achieve. From project initiation to hiring, from hiring to warehouse construction, and then to nationwide expansion, no internet chain has ever been built so quickly.

The consequence of hasty launch is: **platform procurement and sales were chaotic early on, often not even connecting with distributors or suppliers. So initially, wholesalers with sharp information connected with community group buying fastest, because whoever connects first can scale. Additionally, with some low-price e-commerce channels, platforms' external procurement rates were generally high at the start.**

Without connection and cooperation, community group buying sourced from wholesale markets and e-commerce at competitive prices, making manufacturers feel the channel was hard to control and had a significant impact on pricing. Thus, most frontline city managers' first reaction was to watch.

As manufacturers and distributors gradually connected with platforms and business grew, platforms occasionally engaged in price chaos. At this point, city managers began to warn and discipline. Because community group buying platforms initially focused on hot products, prices were sensitive. Even if distributors offered fair prices, platforms might subsidize privately to attract traffic. So, city managers' mindset shifted from watching to controlling.

**From watching to controlling, city managers still act defensively and avoid mistakes, worrying about whether the new channel will harm existing channels.**

However, when everyone discovers that community group buying volume is growing, and it's not from hoarding or fake orders like other internet platforms, but from real sales by group leaders, then distributors seeing profits will approach city managers for platform agency authorization. At that time, city managers need to balance after scaling, especially managing "involution" among distributors.

Yet, as proactive, omnichannel city managers, we cannot just watch, control, and balance; we must take the initiative! Lead distributors to proactively connect, serve, and cooperate with every community platform.

**-03- Future Trends City Managers Should Know**
Of course, while fully engaging with community group buying, every city manager must understand the channel's prospects. For city managers, the following trends are noteworthy:

**First, platforms will shift from attacking to defending cities.**

Lighting up a city, attacking a city, but attacking is not like locusts passing through, harvesting and leaving; attacking is for future defense. Every city manager should fully connect, not only fight blitzkriegs but also lead distributors and teams to adapt to future protracted wars!

**Second, from local to central.**

Looking at many platforms' current strategies, except Meituan which has regional heads, other platforms only have provincial heads, no regional directors, indicating they operate city-by-city, attacking and defending independently. But in the future, these platforms will integrate and consolidate, achieving regional and national cooperation with brand owners. So frontline city managers need not panic about the many "miscellaneous" brands on platforms; don't just focus on prices, but continuously try new marketing tactics and group leader operations to lay out for sustainable growth.

**Third, from hot product hits to marketing integration. Currently, platforms are hitting hot products, sourcing whatever is price-sensitive, but often not utilizing marketing-side resources.**

In the future, platforms will inevitably coordinate product and marketing sides. So shifting from single-product thinking to brand thinking is something every city and provincial manager needs to consider and plan. Don't get stuck in daily order fulfillment and forget what a true brand city manager should do and excel at.

**Fourth, from basic fulfillment to systematic fulfillment. Current fulfillment is measured by delivery speed, frequency, damage handling, and timeliness.**

Future will be systematic fulfillment. Guiding distributors to become platform grid warehouse partners or participate in the logistics system division of labor is something frontline city managers need to consider.

**This channel, whether for city managers or distributors, deserves serious attention. City managers must help distributors, and distributor owners must fully engage proactively, avoiding being just a hands-off boss who only gives orders.**

**-04- Operational Pain Points and Solutions for City Managers**
The confidence and mindset to lead distributors and teams to connect with local community group buying platforms are ready!

Now let's discuss the main pain points frontline city managers face and corresponding solutions.

**Pain Point 1: Low professional quality of personnel.**

Because the community group buying track develops rapidly, platforms have risen in just three to six months, and the talent pool is insufficient. Most manufacturers and distributors are forced into the game, holding a wait-and-see attitude, progressing slowly, and not spending money to hire professionals. Family business staff are directly reused to connect with procurement and platforms.

**Pain Point 2: Only selling hot products with chaotic prices.**

Multi-platform competition is fierce, and platforms hope to quickly open cities and grab consumer share with ultra-low prices. Some platforms have "one product, multiple suppliers," especially for hot products, sourcing from whoever is cheapest. They may even burn money to undercut prices, which sometimes doesn't mean offline hot products sell well, but such behavior severely impacts offline channels, causing distress for manufacturers and distributors.

**Pain Point 3: Platforms have very high requirements for supplier logistics and delivery.**

The strictest is delivering estimated quantities based on morning sales between 12:00 PM and 4:00 PM on the activity day, shortening from previous 72-hour or 48-hour delivery to 4-hour delivery. Return requirements are also high: returns must be requested the day after an event ends; if continuing, virtual returns are allowed. In most cases, continuing isn't possible, so returns must be scheduled the next day, otherwise, it's treated as loss. This process easily leads to goods loss, testing distributors' supply chain capabilities severely.

Corresponding solutions are interpreted from three dimensions: people, goods, and place.

**I. People—Fast, Professional, Ultimate**

According to most community group buying platforms' business cooperation models, four key roles need precise staffing and coordinated efficiency.

**1. Local Sales Team**

Frontline city managers should select young salespeople to form a special team. These young staff should have 2-5 years of work experience, understand online and offline channels and tactics, be familiar with office software, and efficiently analyze data, summarize content, and review promptly. Strong communication and coordination skills are essential. A sense of ownership and a strong desire for success will drive these young sales colleagues to continuously explore and innovate, deeply study channel development, and become business experts in the community group buying track.

**2. Distributor Team**

**At the distributor owner level:** Because this is a new track, the distributor head (owner or general manager) must personally participate throughout, including contract negotiation, product selection planning, promotional activity arrangements, and supply chain fulfillment, to fully understand channel development and details, respond quickly, and improve efficiency, especially in supply chain.

**At the distributor business level:** Act as a bridge and link among the owner, manufacturer, and platform, mainly assisting the owner in serving platform supply chain fulfillment and maintaining customer relationships.

**At the distributor finance level:** Lower gross profit expectations for this channel; suggest using turnover to calculate ROI, initially on a monthly basis, later per event, per warehouse, or even per SKU.

**At the distributor supply chain level:** Divided into self-operated delivery and third-party service delivery. Regardless of the method, carefully study platform rules and meet requirements. Continuously improve supply chain efficiency. Currently, most distributors cannot meet platform requirements, indicating both strict platform demands and that if our distributors achieve this, competitors will be fewer. As platform fulfillment requirements rise, the last one standing wins. It's best to suggest distributor supply chain staff learn and improve professional warehousing and transportation systems, train warehouse and logistics personnel, and continuously enhance supply chain efficiency.

**3. Regional Product Operations**

With internet thinking as the underlying logic and cities as the main battle unit, provincial procurement has key shelf placement decision-making power and more flexible operational permissions. They often come from traditional KA procurement and, in internet internal competition mechanisms, can proactively break out of traditional procurement models to accelerate efficiency. Connecting well with them is crucial for improving shelf quality.

Additionally, high-frequency reviews to develop a set of efficient local marketing tactics are key. For example, analyze data to find daily and weekly peaks, and which price points sell best. From simple product supply to marketing co-creation, regional operations require deeper collaboration.

**4. Terminal Group Leaders**

Group leaders are crucial for the last mile of community group buying, but currently, platforms have weak control over them, and their maintenance abilities vary. How to get group leaders to expose and promote more, and recommend our products more, will be effective!

City managers should thoroughly study the characteristics of group leaders in each city, use flexible incentives and PK rankings on key sales days to increase participation and brand promotion. First, capture the top 10%-30% of core quality group leaders, and get them to promote, sell, and sell well.

**II. Goods—Centered on Consumer Profiles**

**1. Local Consumer Profiles:**

Who are we selling to? Study consumer profiles on different platforms by observing consumers at pickup points and interviewing surrounding people. Community group buying consumers differ from home-delivery consumers. From community group buying consumer profiles, 83% of shoppers are female, 70% are aged 30-49, and 92% are married. This tells us to select products that are more, better, and cheaper—in simple terms, larger sizes, with brand endorsement, and reasonable prices.

At the same time, listing men's, high-end, or small-size products on community group buying platforms will surely lead to slow sales. Don't treat this channel as a way to clear old stock at low prices; consumers are savvy and will have direct usage experience, so avoid unnecessary negative consequences.

**2. Product Selection and Iteration:**

To avoid price wars and unprofitability, continuously cultivate new and trending products! Looking at several head platforms, 60-70% of covered cities are lower-tier markets, i.e., towns, villages, and rural areas. When lacking sufficient data analysis samples early on, we should try high-frequency small-step iterations in product selection, letting consumers give us answers.

Initially, update and replace 3-8 products per platform per week, frequently try regular hot products and various new items, then retain and replace the top and bottom 20% of SKUs. While testing frequently, continuously summarize the local "golden price range." Try products at key price points like 1.9, 9.9, 19.9, 29.9, 39.9, etc., with small steps, and gradually develop a community group buying product mix suitable for the local market.

**3. Price Control and Source Verification:**

Platform sources come from all over, and price undercutting significantly impacts the market. Strictly control and monitor every undercutting incident; require the execution team to review daily activities and trace upstream customers; simultaneously empower existing customers, enhance professionalism and service capabilities, help distributors meet platform requirements, and reduce price impact.

**III. Place—Online + Offline, Secure the Base Before Expanding**

**1. Improve Online Operations Professionalism:**

Unlike traditional channels, platform maintenance requires distributors to have basic page maintenance skills, which is a weak point for traditional distributors! In summary, the "three elements" for listing need special attention:

"One beauty"—Not all e-commerce beautified images suit community group buying. For lower-tier market platform apps, plain and simple images with text descriptions have higher conversion rates.

"Three prices"—Strikethrough price, supply price, and selling price. Check repeatedly (platforms may change prices without authorization; ensure text descriptions are correct).

"Five matches"—Packaging, production date, flavor, specification, and barcode must be 100% consistent with images to reduce listing error rates. On the basis of ensuring basic operational professionalism, schedule frequently, test products frequently, and accelerate turnover.

**2. Learn to Create Festivals:**

Besides daily sales follow-up, key sales days are increasingly important. Collaborating with brands to create festivals is a key tactic to increase average order value. City managers should lead teams to align with major festival rhythms, combining livestreaming, promotional videos, product images, and group leader incentives to boost key day sales.

**3. Create Brand Scenes Rather Than Price Scenes:**

As community group buying battles evolve, the marginal effect of pure price reduction is diminishing. Distributors who only compare prices with other sourcing sources will both lose. Make frontline city managers understand that our brand manufacturers' advantages go beyond price; more importantly, it's brand influence!

This is also the biggest pull for consumers in lower-tier markets. Creating brand scenes rather than price scenes on apps and mini-programs not only increases average order value but also accelerates product breadth.

**4. Offline Linkage:**

As the initial rapid expansion of community group buying completes, competition for market share in each city becomes the main direction. Requirements for order volume, order breadth, and shelf output will become increasingly refined. Eventually, it will evolve into a battle for consumer loyalty to platforms.

So we see platforms trying to invest in offline customer acquisition in local markets, such as market roadshows and platform promotions in malls and communities. City managers should drive and guide distributors to actively participate, doing brand linkage with platforms. This cooperation and support not only increase order volume but, more importantly, enhance cooperation stickiness with platforms to accelerate model co-creation.

About the author: Xu Xiang, currently Southern China Sales Director at Unilever, with 20 years in FMCG daily chemicals, dairy, and condiments, deeply engaged in regional market management and customer marketing. Willing to exchange ideas with peers. The above article represents only personal views.

Tips: A reward of 400-2000 yuan will be paid for any tip adopted.


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