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KH EE
23-09-2004, 02:19 PM
from http://newpaper.asia1.com.sg/top/story/0,4136,73326,00.html?

POOR SALES, SO BAKERY OWNER MAKES OFFER: BUY MOONCAKES AND GET FREE DVD PLAYER

I'm still making a loss, but...
By Tay Shi'an
shian@sph.com.sg

IMAGINE paying $144 for eight boxes of mooncakes and getting a $109 DVD player for free.

Good deal? You bet.

The owner of Natural Secrets, Mr Alan Ng, 28, claims he's losing money doing so. But he was also losing money earlier because business had been poor this year.

Explaining his dramatic offer, he said in Mandarin: 'Competition is so fierce! I usually sell fewer than 10 boxes of mooncakes a day.

'I figured that the loss I make by selling only 10 boxes is about the same as selling many more boxes by giving away DVD players.

'So if I'm going to die, I might as well go out in a blaze of glory!'

He said he paid several thousand dollars to buy the DVD players for the promotion.

When The New Paper visited Natural Secrets Wednesday, there were stacks of Oritron-brand DVD players outside the shop, alongside the mooncakes.

Checks show that the Oritron DVD player retails at $109.

Mr Ng hopes his gamble pays off with more return business from his customers.

He said: 'I want people to remember us as the shop that gave away the DVD players. Hopefully, this time they buy mooncakes.

'Next time, they buy bread or their son's birthday cake from me, I will be able to earn back. Must think long-term.'

Each box of four mooncakes costs from $18 to $32, depending on the type.

Most customers buy eight of the $18 boxes, for $144, to get the DVD player.

'It's almost as though you are getting the mooncakes free,' said Mr Ng.

He said demand for his other products, like bread and cakes, usually fell during the mid-autumn season. So he has to sell more mooncakes to make up for that.

Mr Ng, who opened his shop almost five years ago, said sales of his mooncakes were good in the first two years, but have fallen dramatically since then.

GONE IN A DAY

At first, he gave free VCD players worth $69.90. The response was so good all 100 players were gone within a day.

He then ordered the DVD players.

The posters in front of the shop still offer free VCD players. Mr Ng said he had no time to replace the posters.

He has given away about 50 DVD players since Monday. Last year, he gave away free lanterns.

'But it didn't work, because everyone else did it too,' said Mr Ng.

'This year, I started selling mooncakes about a month ago, making about 100 mooncakes (about 25 boxes) a day. I also ordered about 5,000 sets of packaging.'

Mr Ng employed a worker specially to make mooncakes.

He ordered the DVD players from different suppliers, so they are not all the same brand. He said he has asked the suppliers to keep 500 sets for him.

He said he managed to buy at a wholesale price, but declined to say how much he paid.

'I'm willing to spend $20,000 to $30,000 to see what kind of results I get,' said Mr Ng.

CUSTOMERS THRILLED

Some customers did not notice the posters and bought, say, six boxes.

'I don't tell them. Then I can earn their money too,' he added cheekily.

But those who noticed the offer were thrilled.

Indeed, delivery man Hu Jia Jun was so excited he called The New Paper hotline after he saw the offer in flyers and posters.

Said Mr Hu: 'I don't know how he can do business, but I don't care, as long as the customer benefits!'

Mr Jimmy Koh, 50, a sales manager who lives in Tiong Bahru, bought 16 boxes.

He said: 'I buy mooncakes to give to clients and friends every year, so I might as well get free DVD players at the same time!'
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WHAT OTHER SELLERS SAY

ARE other mooncake sellers using such dramatic sales tactics too?

It seems not.

The New Paper checked out eight others in Chinatown and Havelock Road.

While all eight said competition has become increasingly fierce over the years, none has resorted to giving away freebies.

Five of them do offer discounts of up to 30 per cent to regular customers or bulk buyers. And one of these is Da Dong Restaurant on Smith Street.

Said Mr Tommy Ngiow, its managing director: 'This market is not very big, and the competition gets greater each year.'

But the restaurant, which opened in 1928, tries to stay ahead by introducing new flavours of mooncakes each year.

'We've built up a loyal following over the years. So, there is no need to use other things to promote our mooncakes,' he said.

Added Mr Yip Chik Sang, managing director of Leung Sang Hong Kong Pastries on Sago Street: 'Gimmicks like that means the customers are not there for mooncakes, but for the DVD players. How to sustain?'

Another shop, Chop Tai Chong Kok, on Sago Street, said it does not offer discounts or freebies as its mooncakes are already very reasonably priced.

Said an employee who would identify herself only as Mrs Tham: 'Our profit margins are already very low.

'If we charged $40 a box, then we would be able to give freebies and discounts. But we don't,' she said.

The Mid-Autumn Festival is on Sep 28.
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Wonder whether we will have a similar offer here in the Klang Valley??? Till then, Happy Mooncake Day!
:D :) :) :cool: