Just 4-5 years ago internet had not penetrated too well in India. That time there were some websites that were operating coupons. But these websites/coupon books offered coupons for very costly things. Like Yellow Pages - had a coupon book where it would list some of big hotels, restaurants, etc. I have also seen some other coupon books, which will list Hotels in Hill Stations and offer some 40-50% discount on the prices. Mainly the listed things would often be services like spa, massages, beauty salon, organized hair cut shops, etc.
I think that this sector has not been tapped to its potential. I will explain. If you are supposed to start some small business then you can tap this business idea. There are different models. In one model, you charge merchants for advertising, while distributing the coupons free of charge to the public. In another model, you do not charge merchants, but charge public for the coupon book. You can opt for the second one because most of the time the merchants may not be willing to spend the money. You can charge them for premium spots like Front page, second page, back page, etc.
You go to the local merchants first and then take their permission for overall coupon - like 10 % for purchase of over 1000 bucks & second coupon would be 5 % for purchase of over 500 bucks. They can give some item specific coupons. Once your book is ready, you can think of limiting the number of coupons per merchant. If you have located some 20-30 local merchants with different businesses, you will have enough coupons. Now, if you look at it each coupon can provide Rs. 50 value to the user. If you have such 50 coupons, the total value provided would be Rs. 2500/-. This is considering small ticket coupons. You can have some big coupons too like from furniture merchant. Furniture costs go anywhere between 2000 to 50000 bucks, so if he gives 10% discount, the potential coupon value could be 200 to 1000 bucks if it is capped at 1000.
The potential value of the coupon book can be anywhere between Rs. 5000 to Rs. 10000/- for the user. How much should the book cost to print? Not more than Rs. 20/-. If you use glossy paper and good packaging, then Rs. 40/-. You might have to print 500 copies. Cost would be Rs. 20000/-. But you can sell it for Rs. 100/-. How many could you sell? To cover your costs you need to sell 200 books.
User - If the user sees a definite value of Rs. 200/- in it, will he not buy book for Rs. 100/-. He will easily save Rs. 100/- by buying his normal things. If this is the case, the books will easily sell out.
Merchants - They will continue to advertise in your book because if they do not advertise his competitive merchant will. The book would be popular and who ever has coupon in the book will get more customers.
You - The coupon book will bring value to User as well as Merchants. This should be able to help you recover the costs and also sell out all the books and make profit. You can limit the coupons use for a month and come out with monthly editions. This project would be for masses.
Scaling Up
Once you are comfortable at one location, you can go at other locations and set up merchants there. You can learn different things from different places and apply at other places. You can also have tie ups with different merchants in tourist places. These coupons can be placed at any of your location 'coupon books'.
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