New foreign trade engine cross-border e-commerce new mission

As one of the "troikas" of China's national economy, foreign trade is now facing a difficult predicament. Breakthroughs in the traditional foreign trade model have encountered bottlenecks, and the new foreign trade model has yet to become a climate. In order to consolidate the traditional advantages of foreign trade and speed up the cultivation of new competitive advantages, the State Council issued the "Several Opinions on Accelerating the Development of New Competitive Edge in Foreign Trade" (hereinafter referred to as "Opinions") yesterday. The "Opinions" analyzes the importance of China in fostering new competitive advantages in foreign trade. Urgency, and proposed measures that will promote economic and trade cooperation with countries along the “Belt and Road” and accelerate the development of cross-border e-commerce, creating a “good medicine” for “prolonged illness” foreign trade.

According to customs data, from January to April this year, China’s import and export totaled 1.22 trillion U.S. dollars, a year-on-year decrease of 7.6%. Among them, exports reached 690.16 billion U.S. dollars, an increase of 1.6%; imports were 532.35 billion U.S. dollars, down 17.3%. Exports grew slowly and imports fell sharply. From the data point of view, it is an indisputable fact that China’s foreign trade situation is not optimistic.

As the recovery of the world economy remains weak, the lack of demand in the international market has led to a reduction in China’s foreign trade export orders, and the import prices of bulk commodities have continued to fall. While China is in the transition period of foreign trade, the competitiveness of labor-intensive export industries has continued to shrink, foreign investment in manufacturing industries has continued to decline, and foreign trade competitiveness has suffered significant faults. The traditional advantages have disappeared, new foreign trade has not yet taken shape, and China’s foreign trade is currently at a key point of transformation.

Compared with traditional foreign trade, the development of cross-border e-commerce has become a major highlight in the market in recent years. With the continuous development of e-commerce and global trade, many traditional enterprises and foreign trade factories are poised to enter the field of cross-border e-commerce. More and more traditional foreign trade companies actively seek to land large-scale cross-border e-commerce platforms such as eBay, Alibaba, Aliexpress, and 1688, along with the cross-border e-commerce platforms including Lanting Jishi, Dunhuang Network, Global Market, and the World Factory. Export e-commerce has emerged in the market, and cross-border e-commerce has become the backbone of the foreign trade export market.

In the eyes of people in the industry, on the one hand, the inherent drawbacks of complicated procedures, large amounts of low profits and other drawbacks have made the traditional foreign trade approach decline; on the other hand, cross-border e-commerce platforms such as AliExpress and Lanting Tendency can be represented. Maximize the transaction process, reduce the supply chain, and increase profitability. The superposition of two factors makes cross-border e-commerce successfully occupy the foreign trade market.

High growth does not mean that cross-border e-commerce can go forward. The Beijing Commercial Daily reporter learned that the cross-border import e-commerce business was widely carried out in China last year, and the cross-border export e-commerce was being left out of the capital market. According to Zeng Bibo, founder and CEO of the cross-border import E-Commerce Terminal, in the past, export e-commerce driven by sacrificing labor costs and the environment had no future. Not only were the valuations of the companies low, but the capital began to no longer buy.

Compared with the cross-border imported e-commerce companies currently located in the outlets, cross-border export e-commerce is indeed "insignificant." However, cross-border export e-commerce is still the future of the industry. In Pan Jianyue's opinion, there are many problems in the current cross-border export e-commerce market, such as low level of branding, but the market in the reconstruction stage provides enterprises with the opportunity to establish a brand.

Some analysts believe that the advantages of the original “Made in China” middle- and low-end labor-intensive industries are gradually being lost, and the establishment of more Chinese brands should be the future of cross-border export e-commerce. Over the past years, export e-commerce has been using low prices as an export advantage. With the increase in labor costs and the intensification of competition in export e-commerce, the branding strategy will become the mainstream of e-commerce in the future.