Life with toys

The fifth episode of Beijing Review's Web series: 40 Years of Reform and Opening Up: China's Rural E-Commerce Going Global

By Ma Xiaowen | Web Exclusive

"I think we are the happiest farmers in China's 5,000-year history. We now have money to buy our own house and car," Wu Guosuan beamed.

Xi'ao, the village in east China's Zhejiang Province from where Wu comes, has built its fortunes on toys with a difference. It was a pioneer in the 1970s when the educational toy industry was born and struggled to grow. Today, it is known as the hub of educational toys.

In 1972, the villagers started a public-owned toy factory and began making plasticine for children, using the white clay they dug up from a nearby mine. As the reform and opening up began impacting the villages and China's market economy developed, over 200 private toy factories sprang up during the 1980s. Then e-commerce emerged early this century, giving a boost to the toy industry.

Wu opened his first online store on Tmall, Alibaba's online business-to-consumer marketplace, with his friends in 2012. They collected varieties of educational toys made by the local factories, took pictures of them, and put them online. That year, the store's sales reached 3 million yuan ($436,700). A year later Wu opened three other online stores on Tmall, and the total sales crossed 30 million yuan ($4.3 million) that year.

Since online buyers want to check the quality of the products they buy as well as listen to what other customers' reviews, two years ago Wu decided to transform his model. From an online store he decided to make it both online and offline.

"We manufacture almost all electronic parts-less educational toys in the market. The online sales in 2017 were over 60 million yuan ($8.74 million)," he said.

E-commerce has greatly expanded the market for Xi'ao. Wu told Beijing Review that by the end of this November, his company's total sales had exceeded 100 million yuan ($14.56 million). Moreover, Xi'ao educational toys have entered the global market.

Currently, over two thirds of the 200-plus households own more than 600 online stores with sales over 200 million yuan ($29.11 million) in 2018. The store owners are now seeking cooperation with multinational brands and tapping the international market to usher in the next development phase.

Wu said their sales volume in Russia, India and Latin America has risen year by year. "Our next step is to build our own storage in those places for better distribution efficiency."

A beneficiary of the reform and opening up, Wu thinks the further promotion of the policy is an opportunity for Xi'ao villagers to come up with new ideas and implement them for development.

"In this way, the entire village and China's rural areas will have a new look, step by step," he said.