If you went to Nextage Department Store in Pudong last weekend, you must have experienced the big sale there because of the Men’s Day.

You might also notice that there were a group of men always near the Cashier holding a pile of vouchers in hand asked people if they need vouchers.

Those people are called Huang Niu (directly translated as yellow bull) in Shanghai, who are actually voucher scalpers. How they make money?

Take the Nextage sale as an example, the sale scheme last weekend was you get 300RMB voucher for free, for every 300RMB spent. The store wanted to boost its sales in this way because the more you spend, the more free vouchers you will get. But some customers found this may cause a lot of waste because they actually will end up with a lot of products they don’t need. So it might be good if they can sell those vouchers to somebody who needs it and get some cash back.

Some smart people (scalpers) spotted this opportunity. So they buy the vouchers at 50% of the voucher value and sell it at 70% of the voucher value. So the 20% gap would be the profit they gain.

Customers also welcome this. People who sell the voucher can get some cash back and people who buy the voucher can get more discount.

Of course, Huang Niu business covers more than vouchers in stores, train tickets, concert tickets etc, and also some store cards.

A typical scene in Shanghai would be before the Mid Autumn Festival, scalpers gather at the entrance of Xin Hua Lou which is famous for the moon cake  in Fu Zhou Road buying and selling the gift vouchers.

I really don’t like those scalpers and also don’t like those kind of sales you get XXXRMB voucher for free, for every XXXRMB spent because it really challenges my poor math.

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Tags: Culture Matters

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