Costs and Benefits
The basic costing model for JD.COM is a store set up cost of US$16,000, and various other fees for JD all of which total to around US$23,000 per year. In addition, there is a further US$6,500 set up fees for the marketing operation. For a single operator, this adds up to around US$30,000 in total.
Nourished have established the “Village market” type model, where Nourished has paid the master fee and a number of companies all share that fee between them.
Operating this way the one-off set up cost for each company involved is only NZ$6000!
In addition to the above, there is a product page design fee of $600 for each clients product, and an annual marketing cost to each company of approximately $1,000 per month. This is negotiable and depends on the total number of participants and the number of products that each participant has. As an example, a client that wished to display and sell 2 products can expect to pay $6,000 as a one-off entry fee, a single fee of $1200 for the design of the product pages on the site, and an annual fee of $2,000/permonth) for marketing direct costs.
The case study below shows the effect on sales that can be expected.