Guide to Chinese Cross-border E-commerce Platforms 2021 – HI-COM
In China, cross-border e-commerce holds a specific distinction. Through cross-border e-commerce platforms, international companies are able to sell their products to Chinese customers at reduced duty fees, without needing a Chinese business license.
In the last few years, the Chinese government has implemented numerous policies and initiatives to accelerate the growth of cross-border e-commerce, such as increasing pilot zones, cutting down taxes and tariffs, and expanding retail import lists.
These favourable policies, along with the increased purchasing power of the growing Chinese middle class, has helped turn cross-border e-commerce into a booming industry in China. According to China Internet Watch, in the first quarter of 2021, total cross-border e-commerce imports totaled 138.7 billion yuan (US$21.10 billion), a year-on-year increase of 15.1%.
Today, the cross-border e-commerce industry has seen an explosion in platforms offering a full suite of digital infrastructure and logistics support. For foreign businesses looking to gain a foothold in the Chinese market, choosing the right platform is crucial. In this article, we’ll explore the nine largest Chinese cross-border e-commerce retailers by market share to help you choose the best platform for your products.
Top 7 Cross-border E-commerce Platforms in China in 2021
Tmall Global
China’s largest online B2C cross-border e-commerce platform, Tmall Global, is the international arm of Taobao Tmall, owned by Alibaba. Many of the largest luxury fashion brands from around the world host their products on the platform.
To sell on Tmall Global, businesses must be registered overseas. Documents required include relevant retail and trade qualifications, stock certificates, and brand owner authorization.
Tmall offers cross-border shipping specialists to help handle logistics, allowing for 5-8 working day delivery and tracking. In addition, orders can be processed via bonded warehouses located in China’s free trade zones.
As one of the most prominent and prestigious cross-border e-commerce platforms, it charges high fees. Commission on sales range from 3% to 6% depending on item category and businesses must pay a one-time consumer protection fee of 25,000 USD and an annual technical maintenance fee ranging from 5000 USD to 10,000 USD.
Kaola
Kaola is a cross-border e-commerce platform under the NetEase umbrella and the second largest player in China’s cross-border e-commerce market after Tmall global.
Kaola’s business model is based on procuring high-quality European goods to market to wealthy Chinese families. The reputation and resources that NetEase has built up in the last two decades as a media and gaming company have helped Kaola secure the trust of buyers in a market struggling with fake products and counterfeits.
JD Worldwide
JD Worldwide is the cross-border arm of B2C e-commerce platform JD.com. Counting Tencent, Google, and Walmart as partners, JD.com is home to almost 500 million annual active customer accounts. Whereas Tmall is the go-to platform for fashion, JD.com is more known for 3C products (computer, communication and consumer electronics).
To sell on JD Worldwide, businesses must have a USD bank account and be registered outside of China. Companies must have over 500,000 RMB in capital and provide relevant retail and trade qualifications, stock certificates, and ownership/authorization documentation.
With a comprehensive logistics network of warehouses and shipping stations across China, sellers on JD Worldwide enjoy leading in-house integrated logistics services.
JD Worldwide’s security deposit ranges from 10,000 USD to 30,000 USD and commission ranges from 2% to 8% depending on product. The annual platform usage fee is 1000 USD per year.
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VIP International
Unlike competitors Tmall and JD.com, VIP Shop is a flash-sale ecommerce platform, pre-ordering products in bulk from excess inventory to sell at a significant discount. Capturing close to 40% of the flash-sales market in China, VIP Shop has carved out its own niche in China’s competitive e-commerce industry.
This business model crosses over to its cross-border e-commerce division VIP International. To combat counterfeits, VIP International has set up procurement overseas, and all products are sourced and bought directly from overseas. Like JD Worldwide, VIP International operates an in-house logistics network, with 12 overseas warehouses and 11 in China.
With its pre-purchasing business model, VIP International does not charge brands platform usage fees, commissions, and security deposits. But because of this business model, VIP International only hosts larger brands with existing brand presence in China.
Suning International
Suning is a smart retail platform that combines its e-commerce operations with a vast network of brick-and-mortar storefronts across China. As a company, Suning operates Carrefour China and Dia China. Suning International is Suning’s cross-border e-commerce arm.
Preferring established businesses, Suning International carries many brands that have already established themselves on platforms like Tmall and Jd.com. Suning International offers two cooperation models: the entry model, where businesses sell through Suning’s own in-house integrated logistics network, and the procurement model, where businesses sell to Suning’s overseas partners directly.
The cost of selling through Suning includes a one-time refundable security deposit of 10,000 USD, a commission fee of 2% – 6% depending on product type, and an annual service fee ranging from 5000 – 10,000 USD that is 50% – 100% refundable depending on whether sales targets are reached.
Xiaomi Youpin Global
Youpin is an e-commerce platform operated by Xiaomi, a Chinese consumer electronics giant known for their smartphones and consumer IoT devices. As a Xiaomi operated platform, most of its domestic product offerings are from the Xiaomi ecosystem.
The recently launched cross-border e-commerce platform of Xiaomi Youpin, Youpin Global, counts Korea Agro-Fisheries & Food Trade Corp as a cross-border seller on the platform. Youpin Global works mainly with foreign governments to bring overseas products to Chinese customers on its platform.
Youpin Global has a strategic partnership with JD.com, with their logistics handled by JD Logistics comprehensive warehousing and delivery networks across China.
YMatou
YMatou is a cross-border e-commerce platform focusing mainly on C2C and M2C, or manufacturer-to-customer, sales. In 2020, Chinese microblogging giant Weibo invested in the company as a step towards developing Weibo’s social e-commerce potential. YMatou is known to be one of the pioneers of livestreamed e-commerce trend and was a successful early adopter of the group-buy sales model.
The platform is predominantly oriented towards cross-border e-commerce and it hosts flash sales for overseas brands. With a similar business model as VIP International, YMatou has a limited range of products they pre-purchase from overseas brands with strong name recognition in China.
YMatou operates its own in-house cross-border logistics network under the name Bei Hai International. With bonded warehousing centres across North America, Europe, Asia, and Australia as well as partnerships with many international airlines, Bei Hai International allows YMatou to provide Chinese buyers with cheap and reliable shipping.
Top Non-Chinese Cross-border E-commerce Platforms in China 2021
Amazon Global
Outside of China, Amazon is the ecommerce behemoth. But within China, it has faced stiff competition from the likes of Alibaba and JD.com, leading to the shutdown of its Chinese domestic marketplace in 2019. Today, Amazon China only offers products from Amazon Global Store, its cross-border e-commerce platform, selling overseas products to Chinese customers.
In the last two years, Amazon Global Store has started capturing more market share in China, from 1% in 2019 up to 4% in 2021. Amazon Global Store now has a WeChat mini program and allows customers to pay via Alipay and WeChat pay.
Amazon does not provide in-house warehousing and logistics in China. This means sellers must ship from overseas, leading to potentially expensive delivery costs and extended delivery times. To offset these drawbacks, Amazon Global has implemented free international shipping for Amazon Prime customers in China.
Beyond
Q: What kind of cross-border e-commerce platform is it?
A: This is another overseas shopping platform, selling European, American, and Canadian fashion brands. Around 4000 people download this app on iOS every day.
Launched by American company, BorderX Lab, Beyond is a cross-border shopping platform that brings major European, American, and Canadian fashion brands overseas. Beyond connects with overseas merchants via its official website and self-developed robot ordering system, to provide consumers with great value purchases. At present, Beyond has established cooperation with more than 60 American, European and Canadian merchants, including well-known department stores, comprehensive e-commerce platforms, and famous online brands to bridge the gap between shops (both offline and online) and Chinese consumers.
This will mean that users can place orders with well-known international brands and enjoy local prices without any major price differences. The goods can be delivered to your door by filling in your Chinese shipping address.
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Farfetch
Q: What kind of products are sold on this app?
A: Our main items include men’s wear, women’s wear and daily necessities.
It been downloaded 3.9 million times on Android.
Based in London, Farfetch is a brand dedicated to unique and original fashion styles. It roughly owns about 550 global stores and 200 brands, providing more than 100,000 pieces of clothing, including women’s, men’s, children’s, and unique costumes, etc. Its wide range of products and diverse designer brands help it to stand out.
Founded in 2008 by Jose Neves, a Portuguese entrepreneur, the company has 9 language options on its website and APP. This includes Chinese, English, Japanese, and many more, encouraging fashion lovers to enjoy the experience of buying global fashion products.
Farfetch delivers to over 190 countries worldwide and has delivered to 465 cities in China.
Gilt
Q: What kind of Overseas Shopping app is it?
A: It is a member-based luxury shopping app that provides designer items.
Gilt evolved from The French brand Vente Privee, which uses a very similar model: members receive discounts on luxury items and are able to receive exclusive designer items before they’re released to the public.
Its founders are Alexis Maybank and Alexandra Wilkes-Wilson. They maintain the brand’s image with a membership model that invites its members to visit the site for information and e-commerce transactions.
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