Cross-border e-commerce key engine driving China's exports

When I attended the Fourth Global Digital Trade Expo in Hangzhou, Zhejiang province, in September, I interviewed some merchants who capitalize on emerging cross-border e-commerce platforms and digital technologies to secure new orders from international markets and boost sales.

Li Wenfeng, a young Chinese entrepreneur, impressed me most. He has taken over his parents' toy factory, which was founded about six years ago in Jinhua, Zhejiang.

The factory mainly received foreign trade orders and supplied various types of toys for offline brand owners and dealers in the United States in its early stages of development.

Looking to expand sales channels and reach more overseas consumers amid high US tariffs, Li began selling products through cross-border e-commerce platforms and registered with fast-fashion online retailer Shein.

He told me that his company has decided to increase production in line with the latest sales and market trends from the platform, instead of manufacturing new products and stocking up goods blindly. Currently, sales from the online marketplace have accounted for about 40 percent of Li's total revenue, with its turnover reaching nearly 8 million yuan ($1.1 million) each month.

Cross-border e-commerce, as an emerging form of foreign trade, has become a key engine driving China's exports against the backdrop of headwinds and mounting uncertainties. The country's cross-border e-commerce export industry is gaining momentum with huge development potential.

Experts said this sector is set to play a crucial role in accelerating the digital transformation and upgrading of traditional industries. The core strength of cross-border e-commerce platforms lies in their flexible supply chain model — characterized by small orders and rapid response — that allows producers to adjust manufacturing in real time based on market demand.

This on-demand production model helps to minimize inventory and waste, boost operational efficiency and lower costs. It also increases production flexibility and strengthens the competitiveness of products in the market.

In recent years, Chinese cross-border online retailers are accelerating steps to expand their global footprint in a bid to cultivate new customers and diversify revenue sources.

Temu, a cross-border e-commerce platform launched by Chinese online discounter PDD Holdings, has become popular among consumers overseas as it offers a wide selection of merchandise, including apparel, consumer electronics, jewelry, shoes, bags, cosmetics, baby products and pet supplies at competitive prices.

The platform offers comprehensive one-stop services covering cross-border logistics, operations, marketing, after-sales support and legal affairs, while sellers or manufacturers just need to focus on production and maintaining product quality.

Chen Lei, chairman and co-CEO of PDD Holdings, said the company hopes to use the supply chain capacities it has built up in recent years to create a new channel that enables consumers from different countries and regions to buy products directly from factories, providing more flexible and personalized supply chains and more cost-effective shopping experiences.

Li Mingtao, chief e-commerce expert at the China International Electronic Commerce Center, said Chinese cross-border e-commerce platforms can use advanced digital technologies, such as big data, cloud computing and artificial intelligence to directly link manufacturers with consumers.

"Many traditional Chinese manufacturers excel in production and quality control, but they often lack experience and capability in sales and operations, which limits their access to overseas markets," Li said.

By leveraging these platforms, they can adjust production quickly and reduce inventory levels, which will be conducive to improving the global competitiveness of Chinese manufacturers, Li added.

Data from Amazon show that in 2024, the number of units sold by Chinese vendors to customers and businesses buyers on Amazon's global stores increased by over 20 percent year-on-year. Over the past two years, the number of Chinese sellers with annual sales surpassing $1 million on Amazon's global stores has increased by nearly 55 percent.

Chinese manufacturers should make full use of cross-border e-commerce platforms to quickly capture demand in overseas markets, learn more about relevant laws, regulations and quality standards in these countries, and adjust supply chains to make products that meet local requirements, said Chen Tao, an analyst at internet consultancy Analysys in Beijing.