Compared with traditional foreign trade, the main body of cross-border e-commerce is mostly small and medium-sized enterprises (SMEs), who, through cross-border e-commerce platforms, can quickly respond to changes in overseas markets and consumer demand preferences, which helps to enhance the competitiveness of Chinese products in overseas markets.
Cross-border e-commerce not only creates a track for small and medium-sized foreign trade enterprises to participate in the international market, but also becomes a new growth point for foreign trade.
Rapid development of cross-border e-commerce
Cross-border e-commerce has become an important force in promoting the development of foreign trade.
The General Administration of Customs recently released “China’s annual report on cross-border e-commerce trade” shows that in 2022, China’s cross-border e-commerce import and export scale exceeded 2 trillion yuan for the first time, an increase of 7.1% over 2021. At present, China’s cross-border e-commerce main body more than 100,000, cross-border e-commerce goods import and export scale of foreign trade accounted for by less than 1% five years ago rose to about 5% today. Among them, the export of 1.53 trillion yuan, an increase of 10.1%, accounting for 6.4% of the total value of the country’s exports.
The General Administration of Customs said that cross-border e-commerce has continued to maintain its growth momentum this year. Customs survey of enterprises shows that more than 70% of enterprises expect stable or growth in cross-border e-commerce import and export in 2023.
There are two main reasons for the breakthrough in the scale of cross-border e-commerce imports and exports: first, many foreign trade enterprises are seeking to transform themselves and have begun to trade more through online channels; second, the global economic downturn has led to overseas consumers preferring to buy cost-effective goods, and thus have switched to online shopping, which has prompted cross-border e-commerce to become a new way of selling to the final consumer.
Large space for market development
“Cross-border e-commerce is a very favorable new track for small and medium-sized foreign trade enterprises.” Industry sellers said, for example, apparel companies can design 10 to 20 models of clothing and put them on the e-commerce platform to test consumer preferences, and if they fit the market they are likely to get more orders. “Compared to large enterprises, SMEs
react more quickly to international market preferences and capture information, and the cost of market testing is lower.”
As a new mode of foreign trade new industry, cross-border e-commerce in the foreign trade enterprises to provide development opportunities at the same time, its own also ushered in the development of the period of opportunity. The WTO study shows that the global B2C cross-border e-commerce will maintain a 27% growth rate until 2026. According to the Frost & Sullivan report, China’s cross-border e-commerce market will reach 13 trillion yuan in 2027, with a CAGR of 26.6% from 2022 to 2027. The contribution of China’s cross-border e-commerce market to China’s export market will increase from 14.3% in 2022 to 27.7% in 2027.
Both in the domestic and overseas markets, cross-border e-commerce has a large space and potential for development, and consumer demand is far from being satisfied.
Source: China Securities Journal