Home » Standing on the shoulders of giants in foreign trade – the rise of cross-border e-commerce exports- FT中文网

Standing on the shoulders of giants in foreign trade – the rise of cross-border e-commerce exports- FT中文网

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Standing on the shoulders of giants in foreign trade – the rise of cross-border e-commerce exports- FT中文网

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[Editor’s Note]Next year will be the 20th anniversary of China’s 2C e-commerce. In 2003, as Taobao and eBay began to expand in China, ordinary consumers officially began to contact the concept of “e-commerce”. As China’s e-commerce market continues to mature, China’s e-commerce platforms are also trying to go global through cross-border e-commerce. So how does China’s e-commerce and even the entire foreign trade industry face this difficult transformation? In the complex geopolitical and trade environment, what challenges will cross-border e-commerce face in the future? FT Chinese Network recently organized a special topic on “Cross-Border E-Commerce”, for editing matters, please contact Yan Man [email protected]。

This is the third part of the cross-border e-commerce series. In the previous article, we described how Chinese cross-border e-commerce practitioners started to develop cross-border import e-commerce from “Hong Kong goods stores”. attack” story.

In the previous article, we mentioned that cross-border import e-commerce started to develop from electronic products, so where does cross-border export e-commerce start to develop? In order to think clearly about this problem, we must first think about the conditions required for a good product suitable for cross-border e-commerce.

China 20 years ago was not as good as it is now, neither the economy nor the categories of export commodities were so developed and diverse. 20 years ago, China mainly exported whole batches of goods that were processed in response to the needs of foreign businessmen. Chinese practitioners have not yet spread their brands to overseas individual consumers. In other words, apart from the small “Made in China” on the products, foreign consumers’ understanding of China and its products is still at a very early stage.

At the same time, cross-border e-commerce was still in its infancy 20 years ago: on the one hand, due to the development of basic telecommunications facilities, the Internet was still a new thing in developed countries and only a few people could use it; on the other hand, customs and other customs clearance policies It is also in the incomplete exploration stage, and a system compatible with cross-border e-commerce has not yet been formed.

Therefore, for a product suitable for cross-border e-commerce, first of all, there must be real demand overseas; secondly, the product must be easy to transport and store, so that it can withstand long-term transportation; thirdly, the product should preferably be relatively small and sell well. The price must be relatively high in order to control the proportion of freight to the total price at a reasonable level; it is best for this product to be loved by domestic and foreign consumers, so that it can be oriented to both domestic and foreign markets and reduce fixed costs.

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Crafts such as jewelry are a fitting example. First of all, jewelry design is “different to each eye”, and jewelry of different designs, materials, and prices can find customers in various countries; second, jewelry is usually relatively easy to store; third, jewelry is small in size, light in weight, and The unit price is relatively high, which can bear the cost of air freight; finally, jewelry also has a domestic customer base, so it can also operate international customers on the basis of domestic customers.

Around 2000, the Pearl River Delta was already a place where the jewelry industry was extremely developed. As early as the 1980s, Hong Kong businessmen went north to set up processing factories in Shenzhen Shuibei and Guangzhou Shawan in the Pearl River Delta to produce jewelry. The factories here can not only accept foreign orders, export to Hong Kong and overseas, but also sell to the domestic market. .

The well-developed local jewelry industries in Shuibei and Shawan provide a good foundation for the development of the nascent cross-border e-commerce industry. In the early days of the rise of B2B cross-border e-commerce platforms such as Alibaba, many jewelry merchants have already begun to place their products on the On the Internet, look for new foreign trade growth points outside the existing sales channels. Since the existing domestic and foreign trade means have basically covered the operating costs, this kind of cross-border e-commerce is more of an icing on the cake.

At the same time, the business model of cross-border e-commerce is also more friendly to consumers and producers than the traditional general trade model (the whole batch is exported overseas and then sold overseas). For jewelry and handicrafts, which are “different to each eye” and have a variety of aesthetics, consumers obviously prefer more diverse and richer style choices. But on the producer’s side, this wide selection of styles means relatively higher design costs, and enough consumers are needed to spread the design costs to a reasonable level. At the same time, if such a wide range of designs are combined with the existing general trade model of “pre-manufacturing a large number of products for re-export”, there will be a problem that high inventory will affect the return of funds. Therefore, for the handicraft industry such as jewelry, the cross-border e-commerce model enables consumers to enjoy more choices at cheaper prices on the one hand, and on the other hand effectively reduces the cost and inventory risk of producers.

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This has led to the emergence of the first batch of jewelry B2C cross-border e-commerce traders in the Pearl River Delta. At the very beginning, they bought “tailored goods” that were abandoned by buyers for various reasons from jewelry processing factories, packaged them and put them on eBay, Amazon and other platforms for sale. Because consumers have eclectic aesthetics in jewelry design, even those “tailored goods” that are abandoned by middlemen for various reasons can be sold to final consumers at a suitable price. The relatively low purchase cost of “tailored goods” makes this business sustainable.

Seeing that the jewelers had tasted the sweetness, other merchants quickly copied this model. In addition to jewellery, products with similar characteristics, such as handicrafts and home decoration, also have the conditions of “tailored goods economy”. Therefore, on foreign e-commerce websites in the early 2000s, a number of shops selling cheap Chinese handicrafts, jewelry accessories, etc. quickly appeared.

In this way, China’s export B2C cross-border e-commerce has taken the first step to gain a foothold in overseas markets. From today’s point of view, this step is to some extent “waiting for rabbits”: traders did not take the initiative to participate in the product design, raw material procurement, and manufacturing processes, but only guarded their stores and waited for the end. Goods and consumers are naturally matched together.

This kind of “waiting for a rabbit” model is obviously very problematic today – the availability, style and price of off-stock products are accidental events after all, so the type of goods, inventory quantity, and price positioning of such stores often fluctuate like a roller coaster. It is difficult to drive for a long time. Therefore, although such stores still exist on platforms such as eBay, most of them are passing through.

However, the cross-border e-commerce bosses who have earned the first pot of gold in the tail goods trade have also begun to place orders and make some original designs according to user needs. As we mentioned just now, jewelry and handicrafts are frugal and eclectic products. If platinum is expensive, use gold, and if diamonds are expensive, use zircon… There is always a place for these brands in terms of design and price. foothold.

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Therefore, starting in 2005, some Chinese sellers selling original design jewelry and handicrafts began to appear on eBay and Amazon. They start with the simplest, cheapest designs and start targeting this market segment. Why did it start in 2005? This is because in 2005, China’s domestic e-commerce (such as “Taobao”) has reached maturity, and many sellers have accumulated an understanding of consumer psychology and platform rules in the process of operating Taobao stores, and have developed Corresponding rhetoric and solicitation skills. For example, readers may be quite familiar with the words of the eBay store in the picture below – this is exactly how the operators who have operated in domestic e-commerce have applied the “five-star praise” culture of China’s domestic e-commerce to cross-border e-commerce. example above.

This change from “waiting for a rabbit” to “taking the initiative” has a far-reaching impact on China’s cross-border e-commerce industry. On the one hand, the customer experience accumulated in the domestic e-commerce industry has accumulated some foundations for cross-border e-commerce practitioners to take the first step; on the other hand, the existing domestic industrial chain foundation also provides cross-border e-commerce Getting Started provides a source of supply at the right cost. This allowed China’s cross-border e-commerce to take the most important step, and also laid the foundation for later expansion to other categories and even the development of independent brands.

In the next article, we will talk about one of the most important categories of cross-border e-commerce in China so far – clothing. If the handicraft stores opened by Chinese merchants on European and American platforms for European and American consumers from 2005 to 2010 were an attempt to test the waters, the clothing stores opened by Chinese merchants on platforms around the world in 2010 marked China’s cross-border The e-commerce industry is gradually maturing. Since the demand for clothing categories is much greater than that of handicrafts and jewelry, the clothing industry has also become a landmark industry in the development of cross-border e-commerce in China.

(This article only represents the author’s own opinion, editor in charge: Yan Man [email protected])

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