Fong Lau: Fast-tracking into China with cross border e-commerce @AustCham Access China
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Fast Tracking into China through Crossborder ecommerce Fong Lau Marvel Sun Enterprises Limited November 23, 2016
Transcript of Fong Lau: Fast-tracking into China with cross border e-commerce @AustCham Access China
Fast Tracking into China through Cross-‐border e-‐commerce
Fong Lau Marvel Sun Enterprises Limited
November 23, 2016
CROSS-‐BORDER E-‐COMMERCE MODELS
Types of cross-‐border e-‐commerce
Chinese Consumers
Overseas Merchant
B2C
B2B
C2C
2B vs 2C models 2B (General Trade) 2C
Tax Tariff + VAT (+ consumpMon tax)
Cross-‐border tax / personal parcel tax
Documents required • Customs registraMon • CO cerMficates • InspecMon &
quaranMne reports (CIQ)
• Contract / Invoice • Etc.
Few if any
Chinese labeling Required Not required
Different tax rates (for reference only)
Category Parcel tax (B2C)
Cross-‐border e-‐commerce tax (B2C)*
Taxes for B2B
1. MFN Tariff free products 15% 11.9% (70% of VAT) Tariff + VAT
2. Other than 1 & 3 30% 11.9% (70% of VAT)
Tariff + VAT
3. Products where consumpMon tax applied
60% 70% of (VAT + consumpMon tax)
(e.g. high-‐end beauty products 26.4%)
Tariff + VAT + consumpMon tax
• Always changing • TransiMon period • PosiMve list • Parcel tax is exempted if taxable amount is under 50 RMB • AddiMonal taxes kick in if a consumer’s single purchase amount / annual
purchase amount exceeds a certain sum
*For purchase amount under 2,000 RMB
InternaMonal Courier
(e.g. DHL, EMS)
Customs Agent
Customs Agent
InternaMonal Bulk Shipment Local Courier
InternaMonal Courier
(e.g. DHL, EMS)
Local Courier
InternaMonal Bulk Shipment
1
2
3
4 Customs Agent
CHINA Overseas (US or HK)
Oversea Merchant
Oversea Merchant
Oversea Merchant
Oversea Merchant *
Overseas DC
FTZ DC *
FTZ DC
Chinese Consumers
Chinese Consumers
Chinese Consumers
Chinese Consumers
Logistics Solutions
Free Trade Zone (FTZ)
* B2C order pick & pack is done here
THE SIZE OF THE MARKET
China’s Import eTail (B2C+C2C)
Import B2C eTail
Import eTail by Category
iResearch
REACHING THE CONSUMERS
Pladorms
Pladorms
Shopping mall (POP)
Self-‐operated
Specialized Non-‐specialized
You see only the top line!
Cost per click (RMB) Cost per million impressions (RMB)
Uptrends and downtrends • In terms of indirect
impact, social is driving much bigger increases in retail traffic than any other online channel. Social media increased its share of e-‐commerce referrals nearly 200% between the first quarters of 2014 and 2015.
But traffic can also be “free” • Mobile is social and alenMon is traffic
Social commerce in China • Social in China = WeChat
Source: Yano research
A closer look at the WeChat users
• WeChat is also popular in SE Asia
Social DistribuMon Pladorm • I.e. Amway on WeChat • Consult your lawyer first
The O2O model
Strategize
Transact Build brand
Traffic
Margin
CHALLENGES
Challenges • Trust • Return • Localize or not?
KEY TAKEAWAYS
Key takeaways 1. Think beyond the pladorms 2. Think beyond online 3. Think beyond China 4. Use cross-‐border e-‐commerce as an iteraMon tool 5. Study Chinese consumers’ changing preferences 6. Your brand may have to adapt 7. Local partner crucial
Marvel Sun Enterprises Limited Cross-‐border e-‐commerce full service soluMon provider
• Fong LAU • Tel: +852 2300 2473 • Email: [email protected]
