Tmall International Procurement Model: Advantages and Challenges

In the context of globalization, cross-border e-commerce has become a bridge connecting domestic and foreign consumers and brands. As a cross-border e-commerce platform under Alibaba, Tmall International provides consumers with a variety of products through a unique procurement model.

Tmall International Procurement Model

Since its launch, Tmall International has signed cooperation contracts with Zhengzhou Comprehensive Bonded Zone, Hangzhou Cross-border E-commerce Industrial Park and other enterprises, and has cooperated with Ningbo Free Trade Zone, attracting three of the six pilot cities to join. This shows the interest of various cross-border e-commerce trade pilots in Tmall’s international procurement model. At present, Tmall International’s products cover four major categories: food and health care, clothing, shoes and hats, mother and baby, and beauty and skin care. It has more than 200 stores covering more than 5,000 brands in North America, Western Europe, Southeast Asia, Oceania and other regions, including Versace, COVHERlab, LV, Fendi and other luxury brands.

With the support of Ningbo Free Trade Zone, Tmall Global is able to achieve rapid logistics and distribution, and customers in some areas can even receive goods within one or two days.

Shortcomings

Although Tmall International’s procurement model has significant advantages, there are also some problems:

Avoid tariffs

Some sellers may avoid tariffs through samples or advertisements, which will affect customs revenue, especially for countries that rely on customs revenue.

Avoid commodity inspection

Small foreign trade usually cannot afford the high cost of commodity inspection, so commodity inspection is often not carried out. In addition, because the personal mailing system is relatively loose, there is usually no strict quarantine and inspection process like traditional foreign trade, which makes it difficult to guarantee product quality.

Avoid non-tariff barriers

For example, Argentina implemented new online shopping control policies at the beginning of the year to limit international spending and stabilize the currency. This results in delays for cross-border online shopping packages.

Influence on the retail industry

The rise of cross-border e-commerce represents trade liberalization to a certain extent, which may change the original international trade status and order of various countries and have an impact on small economically underdeveloped countries.

Difficulty in cooperation between countries

The rapid development of cross-border e-commerce requires relevant countries to upgrade customs infrastructure, postal processing capabilities and revise regulatory policies, but countries with poor financial conditions lack interest in this.

In short, as a cross-border e-commerce platform, Tmall International not only brings a wide range of products, but also faces a series of challenges. These challenges not only involve taxation, commodity inspection, etc., but also involve changes in the international trade pattern and the difficulty of international cooperation.