Community Group Buying in Pandemic-Stricken Shanghai

As the dire COVID-19 situation in Shanghai persists, local residents are learning to adapt to a life transformed by stringent lockdowns.

For many, the challenge of obtaining sufficient food has been a particularly acute pressure point. The tech platforms that have come to play a critical role in the organization of services and logistics in major Chinese cities were quickly overwhelmed by surging demand for fresh groceries when Shanghai’s eastern segment of Pudong was locked down on March 28. The densely populated western region, Puxi, followed on April 1. With the city’s 26 million people all rushing to complete individual orders for food delivery to their doorstep, the arrangement became hugely inefficient.

“In the first few days of the lockdown, everyone woke up early to try and place grocery orders on Meituan,” a source told Pandaily, requesting to remain anonymous. “But the system wasn’t working properly, and you had to repeatedly click the buy button for your order to go through.”

Such issues have seen some residents turn to creative workarounds, including the development of algorithms that can allow users to skip digital queues. Others simply gave up on the tech platforms’ services.

The solution? 团购 (tuángòu), or group buying. This strategy has seen neighbors team up to purchase bulk quantities of items, which are then delivered to residential compounds for distribution to individual households.

While this form of group buying has come to serve a unique purpose amid the ongoing Shanghai lockdown, the practice predates the pandemic. With the rise of China’s tech industry in the past two decades, major platforms have experimented with group purchasing services, including Meituan and Pinduoduo.

But the group buying phenomenon witnessed in Shanghai during recent weeks has nothing to do with these tech platforms. Given the inability of major firms to suddenly provide the delivery and logistics personnel needed to complete specific grocery orders for a city of 26 million people, residents have turned to informal community group buying.

This strategy requires neighbors to form groups on WeChat, China’s ubiquitous communication and digital services app. Certain individuals are designated as the group leaders, or 团长 (tuánzhǎng), responsible for placing orders, collecting funds, coordinating logistics, and distributing goods once they arrive.

The WeChat groups are often defined by the type of products they focus on – a group for milk and eggs, one for rice, and even some for more specialty items like chocolate.

“Once you get something that’s harder to find, you can try trading with your neighbors,” one Shanghai resident told Pandaily. “We offered some Coca-Cola in our building WeChat group and got some eggplants in return.”

SEE ALSO: Why is the Community Group Buying Model Surging in China?

These strategies have come to offer a crucial lifeline for Shanghai residents. So crucial, in fact, that when false rumors circulated earlier this week that the city’s government would be restricting group purchases, social media users panicked.

Everyone has been affected by the supply chain difficulties during the lockdown. Kathy Xu, a prominent investor often referred to as China’s venture capital queen, has even been spotted on WeChat asking to be added to a group where she could buy bread for her family during the lockdown.

Because community group buying has served as a vital – albeit imperfect – method for feeding Shanghai’s population during the difficult lockdown period, authorities are not likely to meddle too much with it in the near future. However, the Shanghai Administration for Market Regulation did announce on Sunday that they would work to strengthen supervision, including with certain “reminders, policy guidance and administrative penalties.”

Meanwhile, major tech platforms are reportedly partnering up with urban authorities to ensure Shanghai’s logistics chains can run smoothly. Chinese e-commerce giant, for example, pledged to coordinate the bulk delivery of daily necessities to the city as it attempts to return to normality.

For the time being, though, community group buying has been the most dependable option. As one Shanghai resident told Pandaily, “I don’t know what we would have done without it.”