Until recently, co-ops brought to mind farmers, vegetables, and hippies, but I recently stumbled upon a world of online co-ops that bring deals of 20-70% off right to my door.
An online co-op pools the buying power of individuals to get wholesale prices on items directly from the manufacturer. There is a co-op “host” who arranges the order with the company, takes shipment, repackages the orders, and ships them to each individual buyer.
I’ve found online co-ops for baby items (clothing, books, cloth diapers), jewelry, accessories, clothing, kitchen items, cosmetics, handbags, electronics, and more. Along with the potential savings come some inconveniences and risk. Being informed is the best way to nab a great deal.
Here are 9 ways to save money with an online co-op.
Fees. While prices on the items are usually good or great, you will also pay a small co-op fee, PayPal fees, and shipping costs from the host to you, so make sure to factor in all the costs before you make a purchase. Fees should be clearly spelled out on the order page; if they are unclear, ask the host.
Buy in bulk. Because of the fees, sometimes co-op buys don’t end up being a great deal unless you buy larger quantities, so consider stocking up or purchasing items you can gift, share, or that have a long shelf life.
For example, I recently purchased cloth diaper inserts through the a co-op. For 20 inserts, the Amazon price was $75 plus $11.50 shipping, or $4.33 per insert. In the co-op, I paid $1.25 per insert, plus a $3 co-op fee, PayPal fees of $0.35 + 3% of the total, plus shipping costs of $10.79, for a total of $39.98, or $2 per insert. Even with the fees, I saved 54%!
If I had only bought a few inserts, I still would have paid all the fees, which would have eaten up most of my savings.
Check the source. One way that co-ops save big bucks on some items is by purchasing imported “knock-off” versions. This will usually be clearly labeled, or you can ask the host. If you don’t need name-brand and aren’t brand loyal, this makes online co-cops a great way to save money. Other items will be clearly labeled with the brand name, and savings are usually in the 15-30% range for those items after paying the fees.
Caveat emptor (buyer beware). There are generally no returns on products, so make sure you can see pictures and ask the host (and previous buyers) about the items in question and the integrity of the vendor. If you end up not needing an item, you can often re-sell it to someone else in the co-op group, but this involves additional shipping.
Have patience. One feature of co-ops is that they work by purchasing in bulk, and usually have to meet minimum order numbers before the order can be placed. On popular items this may happen quickly; at other times it takes a few weeks or in some cases, minimums aren’t reached and the order is canceled. Your payment usually isn’t due to the host until the minimums are met, so you can usually cancel your portion if you find the item elsewhere and the order hasn’t been placed yet.
Have more patience. Once the order has been placed, it is shipped to the host (if it’s imported from Asia, this could take a few weeks!). Then the host takes a few days to inventory the order and ship your portion. Make sure you check with the host about the ETA prior to placing your order. Most hosts are also good about communicating any delays to you along the way.
Leave your wallet home. Most online co-ops use PayPal for invoicing and payment, and you will need an account to do business. PayPal offers some security though, in that you can track your shipments and easily get a refund from the host if an order is canceled, as well as open a formal dispute if your items don’t arrive.
Facebook seems to be the place where online co-ops are thriving. But since most are closed groups, they won’t show up in a search. Instead, join the Facebook group “Co-Op Deals and Reviews,” where hosts and participants from other co-ops advertise their groups and the deals they have running. Msg the admin a request to join. Once you find a group you want to try, just join and wait to be approved! You can always leave the group at any time.
Yahoo Groups also features a number of co-op groups you can join and find by searching on the Yahoo groups homepage.
Are you involved in an online co-op? Would you join one?