Trade rides digital wave, new formats

Stay-at-home routines meant that many household products and other key goods like laptops and juice extractors were bought online using cross-border e-commerce channels.

As the pandemic situation peaked last year, many foreign consumers began to buy even mini-excavators and large-scale machinery online from Chinese manufacturers.

Zhang Jinjin, director of overseas sales at Hunan province-based Sunward Intelligent Equipment Group, a construction machinery manufacturer, said sales of mini-excavators with capacity of 0.8 metric tons to 9 tons surged by 145 percent year-on-year in the first half of this year. Many of them were sold via the group's online sales platforms.

"Mini-excavators have become our bestselling products. They have been exported to Europe and North American countries this year. This is mainly related to the continued epidemic abroad. Overseas users are keen to decorate their gardens and houses, and the excavators have benefited from the stay-at-home economy," he said.

A 2.5-ton mini-excavator sells for anywhere between 20,000 euros ($23,584) and 30,000 euros in Germany today.

Sany Group, another renowned construction machinery company from Hunan province, also saw its sales in this category rise considerably on cross-border online channels this year.

Although buying machinery online for the first time could prove challenging, customers appear to welcome the freedom to customize and pick and choose from different varieties, from the comfort of their office or home, with just a few taps on screen or mouse-clicks.

"Clients in the US prefer white color and customers in Russia like green color, while our Indian customers are fond of both white and yellow colors," said Wang Tao, a manager of Sany's manufacturing business unit.

In a guideline issued on July 9, the General Office of the State Council, China's Cabinet, highlighted the importance of accelerating the growth of new business models to advance the high-quality development of foreign trade.

Key measures include encouraging the use of new technologies and tools to empower the growth of such trade, promoting the transformation of traditional sectors and enabling service providers to offer more professional services.

The guideline set out objectives to establish more optimized mechanisms and policy systems for the sector by 2025, by when the nation is expected to upgrade a cluster of internationally competitive businesses.

Besides cross-border e-commerce, the government's latest measures also aim to have an impact on market procurement, comprehensive foreign trade service providers, overseas warehouses and other businesses, said Ren Hongbin, assistant minister of commerce.

Johnny Chou, chairman and CEO of Best Inc, a Hangzhou, Zhejiang province-headquartered integrated supply chain and logistics solutions provider with a business network in a number of Southeast Asian countries, said the company plans to build more overseas warehouses in signatory states of the Regional Comprehensive Economic Partnership in the coming years.

The Chinese company has already built overseas warehouses in markets of the Association of Southeast Asian Nations, as well as export transshipment warehouses in China. It currently operates 16,000 square meters of overseas warehouses in five Southeast Asian economies including Thailand and Malaysia, and more than 26,000 stock keeping units (SKUs).

It handles more than 11,000 orders per day, and mainly provides services to home and global companies from chemical and home appliance industries.

"Building overseas warehouses and conducting cross-border e-commerce businesses can stimulate consumption of quality products. They are also practical solutions to strengthen China's dual-circulation development paradigm in both exports and imports," he said.

China's new development pattern has the domestic market as the mainstay while the domestic and foreign markets reinforce each other.

The country's cross-border e-commerce has grown nearly tenfold over the past five years. Domestic firms currently run more than 1,900 overseas warehouses and about 130 bonded maintenance projects of processing trade across the world, said Li Xingqian, director-general of the foreign trade department at the Ministry of Commerce.

To spur new forms and models of foreign trade, China will encourage its pilot free trade zones and comprehensive bonded areas to build global supply warehouses and transportation hubs during the 14th Five-Year Plan period (2021-25), said Li Kuiwen, director-general of the General Administration of Customs' statistics and analysis department.