Ecommerce hits the Canton fair
Posted by: Jack | 2016-09-01 15:52:03
Companies signed $31bn in deals at the show, marking a 13 per cent decline from last spring, as the number of buyers fell from 202,766 to 188,119.Sluggish performance was due to a slow recovery in traditional markets and a low demand in emerging markets.
Chinese trade – the Canton Fair was also coming under pressure from another angle: ecommerce.
"Before, there was no internet so customers had to come to the Canton Fair, but now it is easy to get information [online] so there is no need to come," said Lina Shang, who has been attending for 15 years. "There are fewer customers and more suppliers, so competition is very tough."
Her company, a sporting goods trader called TSS, has used Alibaba for several years to find manufacturers for the goods it supplies to buyers at the fair. It has also seen its internet sales rise from zero to 10 per cent over the past five years.
During the fair, Mr Liu said trade shows were facing "huge challenges" from the rise of ecommerce in China – to be illustrated in coming years when Alibaba, the world’s largest ecommerce company, is expected to file its initial public offering prospectus. The show has even created its own portal – E-Cantonfair – to tackle the challenge.
Jason Yuan, an exhibitor from Oubohk, which makes clothes with built-in cooling and heating devices, said his company was setting up a portal on Alibaba since it was "very big in B2B".
While many manufacturers said they were using Chinese ecommerce platforms such as Alibaba and Globalsources, others such as Baleaf, a skiwear maker, were also turning to non-Chinese companies including Amazon and eBay to find buyers. "Fewer buyers are coming but the official data never show that," said Baleaf's Eason Tsang.
Zhou Bin, a professor at Shanghai University of International Business and Economics, said ecommerce was efficient for trading standardised products such as household appliances, but less practical for industries such as textiles.
Other buyers said sometimes it was hard to tell if Chinese companies advertising online were legitimate.
"There are lots of cheaters," said Fred Sue, whose small Jiangsu company makes caps for Walmart.
Hu Ming, whose company Honren makes down quilts for Carrefour, Walmart and Ikea, has been using Alibaba and Global Sources for six months, but has struggled to develop business over the platforms. “It is hard to build trust over the internet.”
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