"Group Buying is NOT collective purchasing" blog discussion

ailwyn

Group buying (as in a bunch of like-minded individuals without a company in the middle) is possibly not going to compete with the likes of Tesco, therefore a pretty poor example imvho.... I belong to several forums related to hobbies, Cars mainly, and just gathering a small collective of 10 - 20 people interested in the same part can realise significant (up to ~25%) discounts off the "best internet price".

Tom_ENC

I know of a few sites that bring buyers and sellers together and actually do both "group buying" and "collective purchasing" (e.g. car guy nation). Here's how they distinguish between the two.

A Group Buy is a vendor-driven offer that's made available to the consumers, who can then choose whether or not to join in and buy that particular product or service.

Collective Purchasing is consumer-driven, resulting from groups of consumers collaborating among themselves to package large volume orders for specific products or services of their choosing, which then are taken to vendors who can bid on fulfilling the orders.

Both take advantage of the buying power of large numbers and can result in the same thing (better pricing on specific purchases) but they're different from each other in how they start and how they get put together.