The rise of cross-border e-commerce intermediate supply chains is mainly due to two aspects, namely the inability to directly supply goods and the operation chain being too long. However, the maternal and infant category has its own particularities. Domestic users currently only recognize a few popular brands, and users value the country of origin. If you cannot directly sign a contract with them for supply, they are using “composite supply”, such as foreign dealers, wholesalers, supermarkets or e-commerce sweepers, buyers, domestic importers, etc. Foreign retail giants have similar purchase channels, such as Amazon Metro, Costco, Walmart, etc., and the primary price difference is the smallest.
As for imported cross-border e-commerce, different goods have different purchasing channels. It is not surprising that the eight immortals cross the sea and show their magical powers. The prices are high and low, and the quality is uneven. The primary price difference arises from the struggle between e-commerce and purchase channels.
Some e-commerce companies can only obtain goods through agents or distributors, and intermediate links continue to drive up costs; some e-commerce companies directly cooperate with overseas brands and obtain first-hand goods from manufacturers; there are also The only way to do this is to allocate “cross-channel goods” from sub-purchasers, or buy bulk goods from supermarkets. At present, most of the purchasing decisions of mainstream cross-border e-commerce are based on order information or historical sales data, purchasing from suppliers or purchasing by self-built teams.
If there is no brand authorization, when the source of goods cannot be found, some suppliers will stand up and say that they have goods, which does not rule out adulteration. Large e-commerce platforms that cooperate with overseas procurement will not take the risk of using unknown sources of goods. Experience has proven that once there is a “crisis of trust”, the impact will be immeasurable. Therefore, we will personally or invite the competition company to conduct on-site inspections and visits to check some industrial and commercial accounts.
Most small and medium-sized e-commerce companies get to know their suppliers through WeChat, parties, and events. They cannot judge the supplier’s credit and ability very well, so they need to be treated with caution. “Pack list discrepancies” are common in the supply chain, and delayed arrival is understandable, but those behaviors such as version discrepancies, flight order bounces, and shelf life fraud cannot be tolerated. As for the source of goods, different procurement channels have different pressures on funds, and the market changes rapidly. The first priority is to maintain capital flow.
When faced with the huge domestic procurement demand, the source of goods must have the ability to organize the supply of goods in the short term, including funds, warehouses, and manpower. Many small purchases actually do not have this ability and can only supply the goods with funds. and a large source of goods with integration capabilities. On the other side of the game, domestic e-commerce platforms that purchase large quantities of goods are accustomed to suppliers’ billing periods. Not only is the rational use of funds, but also considering the many uncertainties in the cross-border supply chain, the billing period is a way to avoid risks.
At this time, those who have funds to pay in cash will always have priority in getting supplies. With the gradual expansion of overseas product categories, suppliers, especially brand suppliers, are lacking in resources. Most cross-border e-commerce companies are still unable to form an absolute competitive advantage in the procurement process. The uncertainty of supply channels is also the key to the failure of the New Deal’s “customs clearance order” to be implemented.
1. Supply is in short supply.
While the domestic platform traffic is fighting for who will die first, the competition in foreign supply chains is equally fierce. There are often only a few good hot products. How to form differentiated competition, the key is not the price but the availability. abundant. On the one hand, the region of origin is limited. Local demand in foreign countries is relatively stable, especially for daily consumer goods. Brands will not suddenly increase supply in large quantities. However, with the sudden entry of China’s explosive demand, demand is not stable. If there is a large increase in inventory, brand owners will have to invest in expanding production lines. However, It’s not that simple.
On the other hand, there is a channel conflict. Most of the hot-selling products of well-known foreign brands have fixed sales channels, or have established production and offline regional agents in China. They will not rush to open cross-border e-commerce channels to impact the traditional line. Even if there are exceptions for some popular overseas products, they will choose to open cooperation on multiple platforms. Since these foreign manufacturers cannot adapt to China’s hot selling model, “informal” purchase channels have become mainstream. Judging from Alibaba’s domestic trade import wholesale data, the three most popular importing countries in the domestic market are South Korea, Japan and France.
2. Authorized agent.
Brand licensing has become a focus in the cross-border e-commerce industry chain to avoid counterfeit goods. For example, the channel and supply issues of beauty products have always been a hidden concern in the industry. Without authorization, even if the products are purchased directly and shipped directly, substandard products often appear to be fake despite huge profits. Strive to obtain authorization from brand owners or large international retailers. Direct procurement reduces the intermediate circulation links, thereby obtaining lower purchase prices and great pricing advantages. It has the endorsement of the manufacturer’s brand, ensuring the quality of the supply and ensuring the stability of the supply. sex.
Especially for non-standard categories, it is difficult to gain upstream say through decentralized procurement, and it is also difficult to establish an authenticity guarantee mechanism. In the future, it will be easier for leading platforms or retail giants to directly connect with overseas brands, “first-hand supply” will often be easier to obtain, and the differentiation of commodity resources will gradually appear. The cross-border supply chain has turned from a huge information gap to a transparent one, and opportunities for direct dialogue between cross-border e-commerce and foreign sources of goods are increasing.
3. Purchase from dealers.
Manufacturers usually do not cooperate directly with trading companies and entrust their products to lower-level wholesalers. Overseas brand distributors/agents will allocate goods to cross-border e-commerce companies when ensuring sufficient supply in their own countries. Usually, the prices in this channel are higher than those directly supplied by manufacturers, and sometimes manufacturers do not recognize the authenticity of the goods. At the same time, it is difficult to ensure the supply of goods, which can easily lead to the emergence of a seller’s market, which will have an impact on the purchasing side in terms of price and supply stability, and increase procurement advances.
In order to screen the quality of supply, many cross-border e-commerce companies adopt a “focus strategy” to focus on a few countries, lock in reliable channels, and use one point to expand the area. However, we cannot overgeneralize. Similar to the “parallel import” of automobiles, unauthorized imports still have great spatial advantages. There is also a way to purchase from the domestic general distribution system of the brand, and import through traditional channels through general trade. The origin can be traced, but the cost is higher.
4. Buy in bulk and collect goods.
Purchasing agents do not have the ability to directly cooperate with international brands. When they cannot obtain agency authority and superior channels, they can only “outflank” from the “end” and purchase goods from small foreign wholesalers or retailers. This method increases costs and lengthens the cycle, but it can be regarded as a stream in the gap between supply and demand. Scanning goods from overseas supermarkets is a relatively reckless way of purchasing. Ordinary overseas consumers can only get the retail price, with no price difference, and even have to pay for errands. Popular items are easily out of stock and subject to purchase restrictions, and quality and supply cannot be guaranteed. , there are certain legal risks.
Enterprises will only use this method when there is a large gap or temporary procurement needs. This type of supply organization is mainly Chinese and has certain local connections, warehouses, funds and other resources. It is not limited to obtaining goods from manufacturers, wholesale through channels, and scanning goods in supermarkets. Different from limited-purchase items such as milk powder and affordable luxury items such as luggage and clothing, e-commerce companies can form a team of overseas elite buyers to accumulate purchase experience, master overseas market operations, establish cooperative relationships with dealers, and lock in popular products at promotional prices in a timely manner.
5. Procurement agency.
Agency procurement is commonly known as cross-border import supply chain B2B supply. This type is mainly focused on the transformation of listed companies, international logistics and traders. Strong capital is the key, which is reflected in the bulk purchase of goods, B2B distribution in the bonded area to various e-commerce companies, and strong billing capabilities. In the early traditional trade, they were familiar with trade rules and foreign channels or sources of goods, or they accumulated resources in transshipment and supply for purchasing agents or e-commerce platforms.
The first is procurement capabilities, accumulating upstream resources and quality control of genuine products, and completing agency negotiations, procurement plans, rapid order replenishment, large-scale centralized procurement, order fulfillment, etc. from aspects such as brand, scale, cost, and efficiency. . The second is to sell goods as an agent for brands and become a distributor for foreign second- and third-tier brands, which reduces the cost of establishing brand awareness and distribution network.
The third is logistics execution, opening up all links from overseas to domestic terminals such as data filing, customs declaration and quarantine, packaging and shipping, logistics warehousing, distribution, etc., to meet the needs of small batch shipments of single products, reduce downstream inventory, and supply Methods include overseas pick-up, FOB, CIF, etc. Most of the established import supply chain service providers such as Shenzhen Eternal Asia, Xinlikang, Langhua, and Fusen focus on traditional industries and have integrated a number of agents from various places, some of which are distribution agents, and some are engaged in supply chain finance.
There are many start-up companies that focus on cross-border e-commerce imports. For example, Dolphin Supply Chain mainly provides authentic imported goods, product procurement and agent delivery for small and medium-sized overseas shopping. It has multiple overseas warehouses and bonded warehouse, built its own European and American procurement center, and after multiple rounds of financing, it received investment from brand owner By-Health. Another example is cross-border Tong’s supply chain service providers such as Wuzhouhui, Bendudou, Yitongbai, Yangmeng, Haihuan.com, and Tongtao. Their business chains are similar, including common bonded warehouse dropshipping services. B2B supply chain services are attracting capital attention due to their large business scalability and amazing cash flow.
6. Buy source OEM model.
Almost all retail stores have similar sources of goods, and the gross profit can be calculated at a glance. It is difficult to decide the outcome. The only way is to advance upstream and then upstream. Swisse health care products, which are very popular in cross-border e-commerce imports, have been heavily promoted in China many years ago, but they have never been able to obtain the access approval required by the General Administration of Quality Supervision, Inspection and Quarantine, so they cannot be circulated in the domestic market.
However, with the opening of cross-border e-commerce channels, Biostime spent heavily to acquire this brand. The number of cross-border mergers and acquisitions by Chinese companies is increasing, and several of the best-selling Australian brands in cross-border imports now have Chinese shareholders. While everyone is still working hard to obtain import agency rights, it may not be long before we find that these brands have been acquired by China.
7. Distribution, agency sales, direct sales.
Due to the high threshold for overseas procurement and bonded settlement of cross-border e-commerce, most small e-commerce companies have the need to sell cross-border goods. However, lacking this ability, cross-border dropshipping has room for survival. . Many supply chain companies play the role of wholesalers, mainly using bonded warehouses or overseas warehouses. Small and medium-sized e-commerce companies such as Taobao, Weidian, Weishang, and 02 provide cross-border goods drop shipping. There are nearly 400,000 global shopping merchants on Taobao, most of which involve imported goods. They cannot be the subject of customs filing, and they do not have the qualifications to make cross-border import and export declarations. Many small and medium-sized e-commerce companies start by entering the cross-border field through agency shipping.
This has formed a situation where wholesalers supply goods on Tmall International, and Taobao stores are responsible for consignment sales. In addition, Alibaba 1688 Import has connected with 150 countries and regions, providing a large amount of wholesale supply. If it were not for Weidian micro-business, this market would really be monopolized by Alibaba; relying on supply sources such as Diapers, Xingyun Global Exchange, 51din, Youdian, Axiaxia, etc., micro-business and personal distribution in Moments have also become rampant, such as Kelp.com , a cross-border shopping B2B website, provides a one-stop shopping mall for global mother and baby goods, recruits overseas shopping distributors, micro-business, and offline store franchise agents; Vipshop’s “Weixianke” sharing shopping guide tool, Miya Incubation The “Mami Plan” distribution platform claims to allow users to earn commissions through distribution.
To achieve light operation as a small e-commerce business, it is very difficult to prepare goods by yourself. More funds and energy must be spent on acquiring new customers and operating online stores. This kind of wholesale and dropshipping suppliers Presence is necessary.