Warning: RANT alert and assumption heavy post:
Wow the sassie system is robbery!!
$1000 one time set up fee!!
$50 per shop, lowering in cost until you reach about 100 shops a month it is pointless.
2) Shop fees are determined via the following tiered pricing matrix
# of Shops Shop price AutoScheduling Shop price
1 $50 $3
10 $40 $3
21 $25 $3
30 $17 $3
50 $10 $3
100 $5.00 $3
150 $3.33 $3
250 $2.50 $3
500 $2.00 $3 < - -- - median pricing level
1500 $1.75 $3
2500 $1.50 $3
5000 $1.25 $3
10000 $1.00 $3
Example:
A mystery shopping company that performs between 500 and 1499 shops in a a month would pay $2 per shop and an additional $3 per autoscheduled shop
Also:
- $40 system fee for your company
- $15 for each of your clients
These are all monthly fees.
OUCH!
much respect to companies out there. Had no idea it cost that much for small fries.
So built up, a job might look like this:
$5 fee
$10 reimbursement
$5 sassie fee
$3 scheduling report /editing
If the client has a few locations they are probably charged $75-$150/location. I still see a lot of money going straight to the MSC.
Lets say I capture A small burger chain of 100 stores. One shop per month per location. Over one year:
Net revenue ($75/location): $90,000
$6,960 Sassie fees:
$18,000 shopper fees and reimbursements
$5,000 bonus pool
$3,600 scheduler fees
gross = $56,4000
I mean, no one is getting filthy rich here, but it looks like the schedulers take the biggest hit.
To get even a few employees on payroll, you either need to be charging clients well over $100 a location visit, OR you need 1000's of mystery shops per month!!
Let's say you are CORI, and you have a large client that will be unnamed. Actually, approximate this client times 10 because they have many. The client has 10,000 stores, but only half are shopped (select markets). These shops pay on average $15 a location. This is $15 * 5,000 stores * 10 clients * 12 months = $9 million. This is a great estimate because CORI specifically stated they paid out about 7 million in shopper fees last year.
Back calculating now, they have listed on Manta they are 100-250 employees. Say 150 employees at $60,000 includes a good average overhead and location adjustment. This means they pay 9 million in salaries to employees internally for things like attracting clients, trade shoes, editing, scheduling, etc. Based on an industry average, salaries are usually 30% of total revenues. That means the CORI breakdown might look like this:
$45 / shop fee to the client = 27 million in total revenues.
9 million in salaries
7 million in shopper fees.
11 million remaining for operations and profit. Not bad!
According to [
www.privco.com], and assiming a 22% yearly growth rate in revenues, CORI made about 22 million in 2011. This matches my numbers.
So how the heck is mystery shopping a 1 B dollar industry? Low concentration - lots of small guys, sassies. Well sometimes people like me see money and think everyone is getting rich. Doesn't look so clear anymore.
Actually the one person getting rich IS sassie.
If 20% of all mystery shops are done through sassie, assuming a 1 B /year market, this is 200M in revenues. Assume 20% of the revenues go to paying shopper fees and an average fee of $25. This would mean there are 1.6 Million shops done through sassie a year.
At the auto-scheduling rate $3 + average fee of $2, that is a cool $8M for sassie. Knowing what I know about sassie, it could have been a one man show or even a few people, probably cost less than a million to make. No one person is getting rich, except the systems developers! Cool.
Edited 2 time(s). Last edit at 04/08/2012 03:07PM by marmani.