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MEDG.OB > SEC Filings for MEDG.OB > Form 8-K on 1-May-2009All Recent SEC Filings

Show all filings for MEDIANET GROUP TECHNOLOGIES INC | Request a Trial to NEW EDGAR Online Pro

Form 8-K for MEDIANET GROUP TECHNOLOGIES INC


1-May-2009

Other Events


Item 8.01 Other Events.

On April 30, 2009, the Company announced a change to its business model so that it may focus on higher margin, and thus, more profitable areas as it relates to its gift card business. The Company has changed the gift card segment of its business as to how it will sell gift cards to consumers through its rewards mall programs.

The Company is reducing the number of merchant gift cards that it purchases for resale and is now offering gift cards through more merchants' websites and they will handle both the transaction and fulfillment. The Company will be expanding the number of gift cards members can purchase through the rewards mall portal directly from the merchants websites.

The Company shall continue to sell higher margin gift cards as it has in the past. Certain low margin gift cards will no longer be offered for sale from the Company, but will be available as redemption items for points earned through their malls.

This will have a material impact on its gross revenue from gift card sales. Due to the shift of its business model, the Company will reduce the amount of inventory of gift cards and will reduce administrative costs and overhead associated with larger inventories. The Company anticipates a non-material effect as it pertains to net income from the direct sales of gift cards.

After May 1, 2009, gross revenue from gift cards will be reduced substantially, for the subsequent reporting periods.

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