Business models of Chinese cross-border e-commerce companies

商业模式分析代写 The advancement of Internet, information technology, payment and logistics services, has greatly facilitated cross-border e-commerce.

1. Introduction 商业模式分析代写

1.1 Research background

The advancement of Internet, information technology, payment and logistics services, has greatly facilitated cross-border e-commerce. With the strengths of Chinese manufacturing, Chinese cross-border e-commerce industry develops fast. It has broken the traditional trade methods and structures, and compared with traditional trade, it has greatly improved economic efficiency, flexibility and order processing ability, which provides business chances for Chinese small and medium-sized enterprises. In recent years, the number of e-commerce platforms has soared, and e-commerce payment methods and security have become more and more perfect.

Under the sluggish situation caused by the pandemic of China’s foreign trade import and export in 2020, the import and export volume of cross-border e-commerce has increased against the trend. In the first three quarters, the import and export of customs cross-border e-commerce supervision platform was 187.39 billion yuan, which has exceeded the whole year of last year, with a substantial increase of 52.8%, making outstanding contributions to the stabilization of foreign trade import and export (CIECC, 2021). Cross-border e-commerce has become a new growth point for trade. SMEs can fully grasp the development momentum of e-commerce, use cross-border e-commerce, and select e-commerce platforms to expand market sales channels and accelerate their own development.

According to CIECC (2021), in 2019, the scale of cross-border e-commerce transactions in China reached 1.05 trillion yuan, and the scale of cross-border e-commerce transactions accounted for 33.29% of China’s total import and export value of 31.54 trillion yuan. Among them, the scale of export cross-border e-commerce transactions reached 8.03 trillion yuan, a year-on-year increase of 13.09% compared to 7.1 trillion yuan in 2018.

(Pictures here) 商业模式分析代写

The development of cross-border e-commerce has only been two to thirty years. With the rapid advancement of digital technologies such as the Internet, cross-border e-commerce has shown explosive growth. In the past two decades, China’s cross-border e-commerce has experienced four stages:

The starting stage is from 1999 to 2003. At this time, the cross-border e-commerce platform business model was not yet mature. The platform is attached to traditional foreign trade and only has the function of displaying product information. The model adopted is the separation of online and offline-online where the supply and demand information was matched online and transactions were completed offline. With the continuous development of online marketing, the business model of cross-border e-commerce platforms has gradually taken shape, and the platform has been given online transaction functions, which greatly reduces the transaction costs of enterprises.

From 2004 to 2012, it was the growing stage, when the online trading platform at this time has complete online display, transaction, customer service and payment functions, and the full digitalization of cross-border e-commerce has been realized. The period from 2013 to 2018 was the stage of expanding of cross-border e-commerce as the channels and categories of products first grew rapidly, and the scale of transactions also maintained rapid growth. At this stage, cross-border e-commerce independent brands on Amazon, Alibaba and self-built independent platform began to emerge and cross-border e-commerce services have also been rapidly improved. 商业模式分析代写

Since its development in 2019, the business model of cross-border e-commerce platforms has reached a rather mature stage.

More attention has been paid to refined operations and localized operations and continued to be practiced. Innovative models such as online and offline integration, live marketing continue to penetrate. At present, China’s cross-border e-commerce industry is accelerating the process of trade innovation and has become a new engine for China’s economic growth. The China’s export cross-border e-commerce industry presents the following characteristics:

First, the current export target countries are mainly developed regions such as Europe and the United States. According to CIECC (2021), the United States and France occupy the top two destinations. The mature markets represented by the United States, France, the United Kingdom, and Germany will continue to be cross-border e-commerce exports targets of Chinese cross-border e-commerce companies in the future due to the popularization of cross-border online shopping concepts, mature consumption habits, high level of overall commercial civilization and complete logistics supporting facilities. At the same time, emerging markets such as Russia and India are becoming new promising target markets for cross-border e-commerce companies in China.

Second, the export scale and growth rate maintain high growth.  商业模式分析代写

With the development of online shopping, social media and logistics technology, the demand for cross-border consumption continues to be released; Chinese cross-border exports maintain double-digit rapid growth even under Covid-19, when the business and people’s life are heavily hindered, the total import and export volume of cross-border e-commerce increased by 26.2% in 2020, of which exports remained at a growth rate of 28.7% (CIECC, 2021). The cross-border e-commerce platform brings large quantities of overseas orders to small and medium-sized manufacturing companies. Therefore, exporting through cross-border e-commerce may be one of the development trends of international trade in the future.

Third, the export B2B transaction model accounted for 80% of the total transactions, and the B2C transaction is increasing. According to CIECC (2021), cross-border exports accounted for 80% of the B2B business, occupying an absolute advantage in the market; but the B2C business scale continued to grow from 2013 to 2019, and its scale increased from 380 billion yuan to 1.73 trillion yuan, with a compound annual growth rate of 28.7%, which is faster than the export B2B business in the same period. The main reason for this is the establishment of more and more cross-border B2C e-commerce platforms in China and the establishment of independent stations through SHOPIFY and other channels. Chinese export companies can directly reach consumers and flexibly change products and marketing strategies according to the characteristics of consumers in each market.

Fourth, product categories have shifted.

From the perspective of category distribution, the proportion of 3C and apparel products has declined. According to CIECC (2021), in 2018, the proportions of 3C electronics and clothing were 18.5% and 12.4%, respectively. Compared with the proportion of 3C electronics in 2017, the proportion of 3C electronics decreased by 19.2%, and the proportion of clothing increased by 2.2%. The proportion of emerging categories represented by health and beauty has increased rapidly. Among them, electronics, apparel, outdoor sports and other categories that account for a relatively high proportion are the strong categories of China’s industrial chain, backed by China’s strong manufacturing industry.

1.2 Research method 商业模式分析代写

This research uses a comprehensive case study method and secondary data analysis method. The first part introduces the research including the research background, the research method, the research objectives, significance. The second part is the Literature Review which reviews and sorts out the definitions of cross-border e-commerce, cross-border e-commerce platforms, business models etc. and the existing related researches on the business models of e-commerce companies. The third part is the methodology chapter where the research method, the sampling, the external macro environment of China’s cross-border e-commerce and summarizes the current situation of China’s cross-border e-commerce as a whole.

Then it will conclude the popular three business models supported by different platforms including Self-built platforms, Amazon, Alibaba, and analyze their merits and demerits with the case of Club Factory (a self-built platform to export), Xiaogan Raylux Lighting Co., Ltd. (in short, Raylux, a B2C lighting equipment and plants tents provider on Amazon) and XXX company (still selecting, but should be a B2B exporter on Alibaba International platform). In Chapter four, three cases of different business models will be analyzed in depth including their marketing and strategic management of these companies. This chapter will try to compare their models and make reflections. The fifth part is the inspiration for the optimization of China’s cross-border e-commerce from the perspectives of the platforms, government and the enterprises (Entrepreneurs).

1.3 Research objectives 商业模式分析代写

This research tries to make a comprehensive study on the current Chinese cross-border e-commerce and tries to compare the business models and pays attention to the marketing and strategic management of these companies. Also, this research tries to conclude suggestions from different level of perspectives to make for a better China’s cross-border e-commerce industry and try to benefit the China’s cross-border e-commerce companies with ideas especially in marketing and management. Through comparative analysis of the three e-commerce companies with different business models, this study tries to analyze the advantages and disadvantages of the business model of the studied cases and put forward targeted suggestions for them. Therefore, the research objectives include:

To figure out the overall Chinese cross-border e-commerce data source with secondary data collected from Chinese International Electronic Commerce Center.

To evaluate the trend and issues in the industry.

To compare and contrast the Self-built platforms, Amazon, Alibaba, different business models ith the case of Club Factory (a self-built platform to export), Xiaogan Raylux Lighting Co., Ltd. (in short, Raylux, a B2C lighting equipment and plants tents provider on Amazon) and XXX company (still selecting, but should be a B2B exporter on Alibaba International platform).

To summarize the business models including the marketing and strategic management

of these companies: with the data/evidence from their homepage, online stores and any

related public information as well).

To make suggestions and recommendations for Entrepreneurs, Platforms and Governments to contribute to the Chinese cross-border e-commerce industry.

1.4 Theoretical basis 商业模式分析代写

When studying the concept of cross-border e-commerce platform business model, this study adopts Osterwalder’s nine-element business model theory. From the four major matrices of customers, offerings, operating structure and profits, this study analyzes the selected research cases’ business models. Also, to analyze the overall macro environment where the Chinese cross-border e-commerce companies are operating in, this study combines the PEST theory to conduct a strategic analysis of the external macro environment from the four major directions of politics, economy, society and technology. In terms of industry competition structure, this study uses Porter’s five-force model to analyze the five perspectives of industry competition, buyer’s bargaining power, supplier’s bargaining power, threat of potential entrants, and threat of substitutes.

1.5 Case selection

This study selects three Chinese cross-border e-commerce companies with different business models as the cases. The first is the Club Factory as the company case of self-built platforms to export. As one of many overseas cross-border e-commerce companies rooted in Hangzhou, Club Factory makes full use of the advantages and policy support of the manufacturing industry chain in the Yangtze River Delta. Second, as a country very similar to China’s Internet consumer base and consumer preferences, India is the most ambitious target development market for China’s cross-border e-commerce companies going overseas.

Club Factory can stand out from the competition among many e-commerce giants as Club Factory has created a set of matching graph system for people and goods, and uses big data to connect the supply side and the consumer side. The big data marketing strategy of Club Factory also enables it to quickly occupy the market in India and continue to sink channels. Therefore, the business model of Club’s Factory is worth studying and has high value and reality meaning for Chinese export cross-border e-commerce companies.

Meanwhile, Raylux is a thriving exporter on Amazon,

At last, XXX company on Alibaba,

1.6 Research significance 商业模式分析代写

With the rapid development of the Internet, the e-commerce industry is developing rapidly. As a new format in the Internet and service industries, it not only creates new consumer demand, but also triggers a new investment boom, providing new ideas and new space for public innovation. In the context of economic globalization and changes in consumption habits brought about by the epidemic period, the demand for cross-border online shopping in the global market is constantly releasing. At the same time, as emerging digital technologies such as big data, cloud computing, artificial intelligence, and blockchain are widely used in cross-border service trade, supply chain and payment links, the efficiency of the cross-border e-commerce industry will be greatly improved and new development opportunities will also be provided.

Whether export companies can upgrade or innovate the entire cross-border e-commerce business models in the outlet of digital technology to compete in export market is the key to their survival. Therefore, this research will study the different business models of Chinese e-commerce companies and provide suggestions on the optimization of the business model of the cross-border e-commerce companies.

 

2. Literature Review

2.1 Cross-border e-commerce and its advantages  商业模式分析代写

Cross-border e-commerce is an international business activity that uses e-commerce platforms to make purchases, make payments, and deliver goods through cross-border logistics to complete transactions. Specifically speaking, it is mainly through e-commerce platforms such as Amazon and AliExpress to realize the display of products. Buyers and sellers communicate and communicate, buyers pay in accordance with the agreement, and sellers deliver a series of sales activities in accordance with the agreement. Cross-border e-commerce can be roughly divided into B2B, B2C, and C2C models.

(1) B2B mode

B2B is mainly the abbreviation of Business to Business. It is a transaction between enterprises, so orders are also relatively concentrated, with the characteristics of large batches and small batches. Alibaba International Station is a typical representative.

(2) B2C mode

B2C is short for Business to Customer. The B2C model can also be called the online retail model. This model has the characteristics of scattered orders, small batches, and large batches. There are many domestic B2C models, with independent third-party platforms such as B2C export business Amazon Global Store, eBay, AliExpress, etc.; B2C self-operated + third-party platforms: Global.com, etc.; service providers: One Datong, etc. Self-operated cross-border e-commerce platforms may have a complex customer type as they may have both business customers and individual customers.

(3) C2C mode 商业模式分析代写

The C2C model is a transaction between consumers and consumers (Customer to Customer). Most of these transactions are individual sellers and individual buyers. The most famous one is Taobao Global Shopping.

Cross-border e-commerce urges traditional foreign trade companies to accelerate their transformation and upgrading. As the global economic integration continues to deepen, the ensuing trade competition is also getting bigger and bigger. Traditional cross-border trade has become more and more difficult due to excessive dependence on distributors. At the same time, traditional trade buyers have single demand, relatively long order cycles and limited profit margins.

This is also a problem that restricts the development of small and medium-sized enterprises in traditional trade. Cross-border e-commerce is based on the Internet and can directly face global end consumers, which solves the difficulties faced by traditional foreign trade companies. Cross-border e-commerce has broken the monopolistic middlemen and distributors in traditional trade. After removing the intermediate links, consumers can directly transact with merchants to obtain better prices and superior services.

Price is the biggest advantage of cross-border e-commerce. 商业模式分析代写

The traditional export trade procedure is very complicated. Foreign buyers usually get to know the factory by participating in the Canton Fair (Canton Fair, 2021). After a short exchange, they exchange business cards and communicate with each other via e-mail. There are too many intermediate links, few options, and no price advantage. Cross-border e-commerce breaks the limitations of time and space. Foreign buyers directly trade online through the Internet and receive products directly through cross-border logistics, which not only saves economic costs. It also saves time. In addition, cross-border e-commerce companies also have great tax concessions, and different products enjoy different tax rebate systems, which increases profits for enterprises.

 

Cross-border e-commerce is divided into B2B and B2C models according to different types of customers. Most of the transaction volume in the development of cross-border e-commerce in China comes from the B2B model. Representative examples include Alibaba International Station and Global Resources Network. Typical representative companies of B2C cross-border e-commerce platforms include Amazon. Currently, cross-border e-commerce platform enterprises have become the main mode for the development of cross-border e-commerce enterprises.

 

2.2 Elements of cross-border e-commerce

2.2.1 Cross-border logistics 商业模式分析代写

The real completion of cross-border e-commerce platform transactions relies on cross-border logistics. Since the transportation of goods must pass through at least two countries, it involves customs clearance, commodity inspection, laws, regulations, taxes, and the logistics infrastructure of each country. At the macro level, cross-border logistics also has to face local protectionism and non-tariff trade barriers. These factors have restricted the growth of cross-border logistics in disguise. The current cross-border logistics mainly has the following forms:

商业模式分析代写
商业模式分析代写
(1) International postal parcels

The Universal Postal Union is a specialized agency of the United Nations. It was established in 1874. It is one of the oldest international organizations in the world. Postal parcel is the most commonly used international postal parcel method in the cross-border e-commerce market. International postal parcels have higher restrictions on parcels. I Parcels must be below 2kg, and parcels above 2kg must be used in international postal packages. At the same time, international postal packages cannot be carried with batteries containing batteries commodities, liquids, powders and other commodities cannot be delivered using international postal parcels; the single side length of international postal parcels cannot exceed 60 cm.

Cross-border logistics of postal parcels has a long delivery time and a high packet loss rate, making it difficult to track logistics and distribution information online. With the changes in politics, polices and cost changes in different countries, as well as the common role of trade protection in some countries. International postal parcels are becoming the least choice of cross-border e-commerce.

 

(2) International Express 商业模式分析代写

International express delivery is an important part of cross-border e-commerce logistics, with complete services and fast timeliness. Global express companies are familiar with them: UPS, FedEx, DHL, TNT, ARAMEX, etc. In recent years, China’s logistics giants have also begun to expand. International express business. Shenzhen’s SF Express and Chinese national EMS. The cost of international express delivery is very high. For the transportation of cross-border e-commerce goods with more expensive goods, international express companies generally provide customs clearance and insurance services at the same time. The larger of the volume or the actual weight of the goods is will decide the price. Due to the high cost of international express delivery, the overall proportion of logistics parcels in cross-border e-commerce B2C is relatively low.

 

(3) Cross-border logistics lines

As the price of international postal parcels is low but the service is relatively poor, and the service of international express is good but the price is very high, cross-border logistics special lines are emerging at the right time. Cross-border logistics special lines generally focus on cross-border logistics transportation in two countries/regions. The transportation means and overall routes are fixed, and at the same time, the cost of the entire link is further reduced by concentrating the volume of cross-border e-commerce between the two countries as much as possible. Its moderate price and quality of logistics service successfully occupy the blank market between international express and postal parcels in cross-border logistics transportation.

 

(4) Overseas warehouse

Overseas warehouses provide an effective solution for the development of cross-border e-commerce, transporting goods to the country or region where consumers are located in advance, shortening the distance between goods and actual consumption. In this regard, eBay and AMAZON are pioneers. There are basically two options for cross-border e-commerce platforms in overseas warehouse business: one is to cooperate with companies that provide overseas warehousing services and provide overseas warehouse services by a third party, and cross-border e-commerce platforms help service providers in overseas warehouses provide their services to sellers. Second, cross-border e-commerce platforms open overseas warehouses by themselves and directly let sellers use them with charges.

2.2.2 Payments  商业模式分析代写

The capital flow of cross-border e-commerce platforms will involve exchange rates, qualifications, laws and regulations, policy requirements, exchange of different currencies, settlement, etc., which is one of the important basic requirements for the development of cross-border e-commerce. Cross-border payment refers to the behavior of international debts and debts incurred between two or more countries or regions due to international trade, international investment and other aspects by using certain settlement tools and payment systems to achieve cross-border and cross-regional transfer of funds.

Consumers’ payment habits are also different. Developed countries represented by Europe and the United States have a high penetration rate of online payment, and cross-border online payment is more convenient. In Latin America, such as Brazil, due to the low penetration rate of credit cards and electronic payments, the online payment rate is also low. At present, many consumers are still using online shopping and offline remittance to pay, much like online shopping in China when it was just emerging. Consumers in the Middle East, India, Vietnam and other regions prefer to pay by cash on delivery. With the rapid development of mobile payment in recent years, third-party payment tools have also emerged rapidly, such as China’s Alipay, WeChat, and Europe’s Paypal, Yandex Dengi, QiwiQallet and WebMoney. The world is ushering in a period of rapid development of third-party payment tools.

 

2.3 Cross-border e-commerce business model

 

2.4 Research on the Cross-border e-commerce 商业模式分析代写

Bennett (2013) conducts a survey on the characteristics and experience of 148 British export companies, and assessed the contribution and perceptions of Internet use to their company’s marketing efforts. They believe that the main obstacles to restricting exports are psychological distance, actual export issues, resource constraints, trade restrictions and market risk. Being aware of these factors can help SMEs to use cross-border e-commerce to expand overseas markets. Moodley and Mike (2004) concludes SMEs still face the problems of financing difficulties and a single financing method. The promotion of financing innovation for SMEs is still a relatively important issue.

Governments should give stronger policy support to small and medium foreign trade enterprises in the process of exporting, and has gradually become the mainstream of the country’s foreign trade innovation and development as SMEs do foreign trade through cross-border e-commerce, it is not only an opportunity, but also a challenge. Wang, Peng, Li-Ting and University (2019) conclude the most important factor affecting cross-border e-commerce enterprises is the corresponding technical support, followed by the external pressure and strategic plan of the enterprise, and finally the customer experience and demands. In order to increase the cross-border e-commerce enterprises performance, it is necessary to increase infrastructure construction, promote technical support, create a good macro environment, optimize business models, and cultivate cross-border e-commerce talents.

 

3 Methodology 

3.1 Research method

3.2 Case introduction 商业模式分析代写

3.2.1 Club Factory

Club Factory is a self-built cross-border e-commerce platform launched by Hangzhou Jiayun Data Technology Co., Ltd. in 2016 that focuses on India, Southeast Asian and Middle Eastern markets to export. Club Factory has obtained a D round of $100 million in financing. It is now among the top three e-commerce companies in India within two years with Amazon India (U.S.) and Nipkart (India). 70% of its business is in India, and its products cover apparel, accessories, electronic products, gadgets and household products.

3.2.2 Raylux

Xiaogan Raylux Lighting Co., Ltd. was founded on October 27, 2016. Located at the intersection of Xiaohan Avenue and 107 State Road, Xiaogan Raylux Lighting Co., Ltd. is a High-tech factory with a registered capital of 5, 000,000 yuan. During the 3 years of the company’s development, it always provided customers with excellent products, technical supports, and directly after-sales services.

Raylux mainly deals in the production, processing and sales of lighting appliances, light source equipment, intelligent control equipment, lighting-related accessories; sales of automation equipment, electronic testing equipment, instruments and meters; import and export business of goods and technologies (according to the law. It must be carried out with the approval of the relevant departments). Since the company was founded, rapid development and growing business have occurred. Raylux always stick to the service principle of “customers first and quality uppermost”, it has obtained a high reputation among clients on Amazon.

3.2.3

3.3 External Macro Environment Analysis 商业模式分析代写

 

3.3.1 PEST Analysis
3.3.2 Five Force Model

3.4 Case study

3.4.1 Club Factory business mode analysis

Products

Target customers

Strategic management and Marketing strategy

(Logistics, marketing, payments, profit model)

3.4.2 Raylux business mode analysis 商业模式分析代写

Products

Target customers

Strategic management and Marketing strategy

(Logistics, marketing, payments, profit model)

 

3.4.3 XXX business mode analysis

Products

Target customers

Strategic management and Marketing strategy

(Logistics, marketing, payments, profit model)

 

Reference List 商业模式分析代写

Bennett, R. . (2013). Export marketing and the internet. International Marketing Review, 14(5), 324-344.

 

Moodley, S. , &  Mike, M. (2004). Does e-commerce fulfil its promise for developing country (south african) garment export producers?. Oxford Development Studies, 32(2), 155-178.

 

Wang, D. D. ,  Peng, S. S. ,  Li-Ting, Y. U. , &  University, A. X. . (2019). Study on joint distribution of micro,small and medium cross-border e-commerce enterprises. Logistics Engineering and Management.

 
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