New policies to help e-commerce units, say insiders
Businesses engaged in cross-border e-commerce said they stand to benefit from a slew of preferential policies unveiled by the State Council on Wednesday to boost the sector’s development and further unlock consumption potential.
Measures to simplify procedures for the entry of firsttime imported items, expand product categories to enjoy preferential rates, and lift the bar for purchase limits per head are clear indications that China aims to use cross-border e-commerce as an impetus to fuel steady economic growth, according to industry players and experts.
“The string of policies are seen as concrete steps taken to implement President Xi Jinping’s announcement to further open up the economy and accelerate the development of e-commerce, which was made during the China International Import Expo earlier this month,” said Zhang Lei, CEO of NetEase Kaola, a leading Chinese cross-border portal.
“It is a strategic commitment to the industry as a whole and is conducive to driving consumption upgrade and advancing economic growth,” she said.
The firm had pledged to procure 20 billion yuan ($2.89 billion) worth of goods with 110 companies during the six-day event to beef up its imported product inventory and meet the growing needs of the country’s tens of millions of middle and high-income earners.
Zhang made special reference to the addition of 63 categories, and the increase in the limit on purchases of goods that are eligible for preferential policies, which can not only spark spending on affordable luxury items, electronics and beauty, but also further adjust and optimize cross-border e-commerce categories.
Also jumping on the global procurement bandwagon is Tmall Global, the dedicated cross-border platform of Alibaba Group, which announced an ambitious plan to help import $200 billion worth of goods over the next five years.
“We see continued stability and certainty on the policy front,” said Liu Peng, general manager of Tmall Global Import and Export. “It is a clear nod to the innovative model of the entire cross-border e-commerce model in China.”
Imported merchandise hogged the limelight in Alibaba’s iconic Nov 11 shopping festival this year. Without disclosing sales figures, the company said it took just over six hours for cross-border online transactions to reach last year’s full-day record on Tmall Global.
Foreign brands can also harness Chinese companies’ expansive analytics and technologies to discover opportunities, fine-tune product selections and craft campaign messages tailored for Chinese consumers, Liu said.
Cross-border e-commerce is a better way for foreign brands to make their Chinese market debut thanks to easier access, lower costs and reduced time for market entrance, according to Zhang Tianbing, Deloitte Asia-Pacific consumer products and retail industry leader.
The enhanced policies will also “propel different e-commerce players to really build up their respective strengths and tighten their grip on resource integration from procurement, logistics, customs and sales ... to provide genuine end-to-end quality services”, said Cao Lei, director of the China E-Commerce Research Center.
Zhang from Kaola also said she found it encouraging that government authorities are working on tax refund policies to boost Chinese companies’ exports via e-commerce. She said such endeavors have inspired Kaola to empower Chinese manufacturers and help Chinese brands to tap into foreign consumers.