Follow Us

We use cookies to provide you with a better experience. If you continue to use this site, we'll assume you're happy with this. Alternatively, click here to find out how to manage these cookies

hide cookie message

British woman bakes 102,000 cupcakes and loses £12,500 in Groupon deal

Rachel Brown bakes 8,500 batches of cupcakes for clients after offering an insane Groupon deal

Article comments

British baker Rachel Brown was forced to make 102,000 cupcakes for Groupon customers in a deal which she estimated cost her Need a Cake bakery around £12,500.

Ms Brown offered a "too-good-to-be-true" Groupon deal for her customers. The discount was 75% off for 12 cupcakes, which normally cost £26. At this price, customers could nab a dozen cupcakes for just £6.50 - and nearly 8,500 of them did.

She ended up hiring extra workers to her Berkshire bakery to cope with the sudden influx of bargain-seekers.

"Without doubt, it was my worst ever business decision," she told the BBC, "We had thousands of orders pouring in that we really hadn't expected to have. A much larger company would have difficulty coping."

Ms Brown estimates she lost £12,500 in total when she includes the cost of hiring extra workers.

"We approach each business with a tailored, individual approach based on the prior history of similar details," Groupon's International Communications Director Heather Dickinson told the BBC. But there was no limit on the number of deals that could be sold, Dickinson said.

Dickinson also told the BBC that she had been in "constant contact" with Need a Cake, and that this was the first time she heard the company had any issues with the deal.

This is not the first small-business tale of woe when it comes to Groupon. In March 2010, Posies Café in the US went through a similarly devastating experience with the hot deal site. The Oregon-based coffee shop and bakery ended up losing about $8,000 from a 50% off promo that sold nearly 1,000 Groupons. Posies' also had no limit on its deal.

While the Need a Cake bakery story is far from the first (and, likely, far from the last) Groupon horror story, it's yet another warning to SMBs thinking of using the service: it's really important to not get swept up in the Groupon-frenzy, especially if your business may not be able to support it.



Share:

More from Techworld

More relevant IT news

Comments



Send to a friend

Email this article to a friend or colleague:

PLEASE NOTE: Your name is used only to let the recipient know who sent the story, and in case of transmission error. Both your name and the recipient's name and address will not be used for any other purpose.

Techworld White Papers

Choose – and Choose Wisely – the Right MSP for Your SMB

End users need a technology partner that provides transparency, enables productivity, delivers...

Download Whitepaper

10 Effective Habits of Indispensable IT Departments

It’s no secret that responsibilities are growing while budgets continue to shrink. Download this...

Download Whitepaper

Gartner Magic Quadrant for Enterprise Information Archiving

Enterprise information archiving is contributing to organisational needs for e-discovery and...

Download Whitepaper

Advancing the state of virtualised backups

Dell Software’s vRanger is a veteran of the virtualisation specific backup market. It was the...

Download Whitepaper

Techworld UK - Technology - Business

Innovation, productivity, agility and profit

Watch this on demand webinar which explores IT innovation, managed print services and business agility.

Techworld Mobile Site

Access Techworld's content on the move

Get the latest news, product reviews and downloads on your mobile device with Techworld's mobile site.

Find out more...

From Wow to How : Making mobile and cloud work for you

On demand Biztech Briefing - Learn how to effectively deliver mobile work styles and cloud services together.

Watch now...

Site Map

* *