Welcome! Thursday - Jun 22, 2017

Going “E-Direct” Cross-Border China E-Commerce Strategies


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Australian small business owners can now sell directly in China using e-commerce without holding any inventory within China, hiring local staff, or even establishing a local Chinese entity. This is the result of a new arrangement between Australia Post and Alibaba’s Tmall Global. Australia Post is helping to facilitate e-commerce sales of products such as food, clothing, footwear, health supplements, baby and maternity wear, and skincare products.

 
Is this a one-off example, or will we see more opportunities for Chinese consumers and foreign sellers to easily facilitate commerce without the common headaches most e-tailers face today? Our firm believes that this is only the beginning of what is likely to be a significant increase in diversity of channels for Chinese consumers to purchase overseas goods directly from foreign merchants. As we discussed earlier, Tmall Global is aiming to open the door for cross-border e-commerce. Meanwhile, Alibaba’s third-party payment tool, Alipay (similar to PayPal) experienced 117% increase in sales of overseas goods in 2012. Other sources estimate the market for overseas online shopping via Chinese platforms reach $11.3 billion in 2013.
 
Beyond the data, we have worked with several American and European retailers over the past year who have developed innovative strategies to sell goods directly to Chinese consumers by capitalizing on the explosion of Chinese outbound tourists around the globe. Many of these visitors return to China craving the same high-quality, and relatively inexpensive merchandise they purchased during their travels.
 
While opening stores on marketplaces like JD.com and Tmall remains the most effective way to attract China’s online shoppers for Western brands, the process of platform selection, strategy formation and day-to-day store management can be daunting for first-time market entrants. However, as China’s e-commerce market continues to evolve at a rapid pace, disruptive opportunities will emerge that can help buyers and sellers connect directly and avoid all of the hassle.

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