November 24, 2014: Since they are now a product reseller and I know we'll get asked about this frequently, discussion and linking to Massdrop's sales is allowed. However note that some of their sales appear to be unauthorised by the manufacturers (ie: are illegitimate group buys from dealers) who have stated that they will not warrant the items.
In general, group buys and group builds (of DIY products) are not allowed, except for hard-to-obtain DIY parts or special DIY one-offs (such as circuit boards). These still require permission from an admin before they can be approved, however.
Recently a number of people have asked why we don't allow group buys or discussion of groups buys on other sites. While we understand that people wish to buy items as cheaply as possible, a number of very serious issues have come up with group buys that have made us expand the rule to include group buy sites.
1. Predatory pricing
The following is an extract from a PM Jude sent to a member as to why group buys on Head-Fi are no longer allowed (with the exception mentioned above):
2. People losing money from overwhelmed vendors and members who offered to build DIY products.
Due to the size of Head-Fi, a product gaining a sudden huge interest can cause serious issues for a vendor. In similar cases, a vendor has been overwhelmed with requests and, as orders were significantly delayed as a result, they have been overwhelmed with emails asking where their item is or wanting a refund. With no more money coming in after numerous people start complaining and filing Paypal complaints (resulting in their account being frozen) the vendor is run into the ground and not only cannot fullfil orders, but is unable to refund people. The result is usually a great many people out of many thousands of dollars. Even if they have money, they can end up legally inundated, wiping out any remaining money they have on legal fees.
Vendors can even suffer this if they are small. Of half-a-dozen very popular 1-2 person cable-making companies, one had extreme weather destroy his workshop and from there his business altogether, leaving his customers out a great deal of money. A second is so popular he had a 1 year waiting list at one point. That is how overwhelmed a company can become even in spite of a group buy!
The following are three of many examples where this has happened:
- A group buy was started for the Thunderpants T50RP mod. The modder, Smeggy, ended up so overwhelmed that, 2 years later people still have neither received headphones or a refund.
- A number of people had asked Billavideo to make them wooden cups. When he was suddenly hospitalised with a back condition everything went down the drain and he disappeared under an onslaught of people who had lost money.
- A new IEM company, having been refused a group buy here went ahead with it on another forum. Despite the forum being only a tiny fraction of the size of Head-Fi, the vendor was overwhelmed with orders and many customers only received their IEMs many months later than expected.
- A group commissioned someone who looked competent to build a number of electrostatic amps for a couple of thousand dollars each. That person has now run off with over $6000 of peoples' money.
- Another group commissioned a member to build a number of boxes for adapting speaker amps to headphones. Likewise they suddenly disappeared with the money. Due to the delay after the members had paid being longer than 45 days, Paypal refused to deal with the situation. It wasn't until federal agents got involved and paid a visit to the member and threatened him with prosecution for wire fraud that the money was refunded.
3. Fakes, unauthorised sales and faulty products.
A very famous, well-known audio company contacted us about a group buy on another site that they hadn't authorised. This company has long been the target of fakes. There was a good possibility that the group buy was actually with a company that manufactures the fakes or is an un-authorised distributor. That would mean that either a: people got a fake product or, b: Got the real product, but would be refused warranty service if it failed.
Members who participated on another group buy received headphones that had been opened and the serial numbers removed. In some cases, the headphones arrived with neither their serial number or box. The site claimed that the group buy was done through manufacturer, but the manufacturer told us that this was not true and would certainly never authorise products sent without serial numbers or boxes.
We've also observed companies, in desperation to prepare products in time for group buys, have sent out untested and faulty products, resulting in lost money for customers who end up having to pay for return shipping. If the company doesn't pay for it themselves (and lose a lot of money in the process) there goes some or all of your savings on the regular price!