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Black Friday, a term that has recently found its viral tendency in Pakistan, is being floated around all over the internet. The rightists claim that Friday can never be Black, while the rest wait impatiently to avail sales on the international holiday.
What exactly is Black Friday? For you to know, it is the day after the US holiday of Thanksgiving, regarded as the first day of the Christmas shopping season, on which retailers make many special offers and customers rally up to make the most of the opportunity.
In Pakistan, many different websites that work around E-Commerce offer special Black Friday sales, which go on for a whole week. However, not everyone is pleased with the idea, calling the event a ‘hoax’ and a ‘scam’. Who is the actual winner of the whole Black Friday charade? Let’s find out.
E-Commerce websites in Pakistan work with different vendors from all over the country and abroad who display their products with the company. The company acts as a mere middleman between the vendor and the customer who logs on to the website to buy a product.
An ex-employee of one of Pakistan’s top E-commerce website spoke to Parhlo on the issue. According to him, what the company does is that it takes loans from banks, banks that are payment partners of the business, through whom all transactions take place. The loans taken are huge, used to pay the gap that Black Friday sales create — between the vendor’s demand and the customer’s buying price.
Not only this but vendors who own products in bulk, generally allow Black Friday sale on their products, because their cost-to-sale ratio is better than their competitors. All of this seems sort of fine, as the customer is still benefiting. However, the real tricky part comes in on products that see huge margin on sales but have been covered up in a different, ‘shady’ manner.
The questionable part starts when product prices are raised from the actual price to an imaginary rate. The imaginary rate is then given a huge margin, on sale, making it look like the product is being sold at cheaper rates. Confusing? Let’s make it simple. An ‘XYZ’ phone costs Rs. 20,000 in the market. Just before Black Friday, the company would raise the price of the phone to Rs. 26,000 (imaginary price) and then give a huge discount on it, selling it at Rs. 20,500.
This makes it look like there’s a huge sale present on the phone, but in reality, it is still being sold at a higher rate, bringing more profit than before. In such particular and similar cases, there’s a mutual agreement between the company and the vendor on the selected products that see imaginary prices set and then discounts given.
With the whole Black Friday scenario studied in detail, it leaves just one impression on a sane mind. At the end of the day, there’s only one loser, and it’s the customer. The company earns through different means on the sale, along with the vendor who does not compromise a lot on the product’s price, while the customer hopes that the product doesn’t end up faulty.
