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Md Delwar Hossain
May 11, 2022
In Welcome to the Forum
Although the rules of Double Eleven are more and more complicated every year, it still cannot stop the enthusiasm of the "buy, buy, buy" army. What Special Database Double Eleven refreshes is not only sales records, but also consumers’ perceptions of prices: special offers were popular in the past, with 40% off, 50% off, and 40% off. Whose discounts are competing on the e-commerce track is more attractive; now The popular ones are Special Database low prices, 1 yuan welfare, 9 yuan 9 specials, fancy ultra-low prices have inspired the huge carnival of social e-commerce. Is it a strategic loss or sustainable cost control behind the ultra-low price? After the carnival, let us return to rationality and discuss the secrets behind the low-cost explosions. The logic of low-cost explosions The pursuit of low-cost explosives Special Database is small profits but quick turnover. Well-known companies such as Jingxi, Pinduoduo, Costco, and Xiaomi are all taking the route of extreme cost performance. If it sells 10 million, it needs a 10% profit to survive. Then, if the sales volume is 100 million, it only Special Database needs 1% profit to survive, provided that the enterprise can bear the result of low gross profit. To understand the "scale effect" in economics, commodities generally contain fixed costs and variable costs. And the fixed costs in this are constant, so the more you produce, the less fixed costs are allocated to a single product, and the more profitable you are. With economies Special Database of scale, companies have higher bargaining power and can quickly acquire a group of users in a short period of time. With the help of low-cost explosions, Pinduoduo has achieved impressive results in the capital market - it only took two years to break the 100 billion Special Database GMV mark. To achieve this figure, Taobao took 5 years, Meituan took 6 years, and took 10 years. How to create a low-cost explosion.
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Md Delwar Hossain

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