Monthly Archives: October 2009

The Economy and Me

October 26, 2009
I’m not an economist, so when China’s GDP figures were released last Thursday I reacted like any business owner would do, and looked at what that meant for my bottom line.
There are huge, complicated implications for any economic fluctuation – and while keeping informed on macro trends is important, the reality is that micro trends are going to affect most of us obviously and imminently.
It has been heavily reported that China exporters bore the brunt of the decrease in global demand following the economic crisis, in which case I should be worried. But my internal figures tell a different story.

It is offline trade that has seen the real impact of weakened export markets in China. My company, DHgate.com, has seen GMV increase by an average of 20% per month for the last 5 months, indicating that manufacturing companies in China are embracing new technology to reach international markets

Live interview on "Asia Business Tonight"

Live interview on "Asia Business Tonight"

With more than 30 years experience in international export, technology-wise China, via companies like my own, can provide mature solutions for suppliers allowing them to increase their capabilities and competitive advantage for global buyers.

Global demand is also improving, as DHgate’s figures will attest, with order increases recorded from international retailers in markets such as the US, Europe and Australia. Further, the Chinese customs agency said September exports fell 15.2 per cent to $115.9 billion US from the same period a year earlier, but that was the least in nine months, another sign that global demand is rebounding

In spite of what is happening in the global economy, I believe that if businesses can keep cost competitive, if they can differentiate, if they can provide a valuable and reliable service and/or product and if they can innovate, then there is a very good chance of success.

So when Bloomberg’s “Asia Business Tonight” show asked me to appear and discuss the results from my business’ perspective, I felt confident I could communicate these economic results from a real point of view – a business owner who wants to grow.

Has your business seen signs of the recovering economy? I’d love to hear your story, here.

Posted in: Events and Happenings, Personal Insights, Press, Trend Insights – No Comments

Location, Location, Location

October 22, 2009

When I joined the technology industry two decades ago, the marketing landscape looked very different. My time spent devising strategies while working for Microsoft and Cisco, and even 5 years ago at the launch of DHgate, feels like a lifetime ago when I consider the innovations that are now part of the marketing norm. The many advancements, such as SEO, PPC, CTR, and so on, not only introduced a whole new acronym-based language to the office, they have also meant that we are now closer to our existing and potential customers than ever before. But no innovation has given our business more ‘personality’ than social media.4square

With Facebook, Twitter and the likes now a standard habit for individuals and marketers alike, I have made it part of my routine to keep an eye on the 2.0 horizon for any newcomers that may up the ante, so to speak. I recently came across a development which may prove helpful to retail outlets with shop-fronts.

New kids on the block, Foursquare, have developed the latest 2.0 technology which allows users to log their location and “check in” to various establishments. From a social perspective, I can see this being very popular. From a local business perspective, I can see it being profitable.

When I came across this article (read here) the other day, I immediately thought of the potential for bricks-and-mortar SMEs to reach and attract footfall. With the option for stores to provide promotions and incentives to users in their locale, advertising here could be a particularly interesting concept. It is also entirely measurable – Something that can’t be said for most advertising methods.

Plenty of others (including Google) are working on similar ideas surrounding location-based coupons, but the Foursquare idea has different potential because it’s a more proactive use of location-based services. On one level, Foursquare is more of a game, and some people use it to obtain a high score and get badges (for checking in certain places). That’s different from being in a place like a grocery store because you’re shopping as you normally would, and seeing a coupon pop up.

While its long-term success is still unproven, and its availability still fairly limited, this newcomer may be worth keeping an eye on.

Posted in: Business News, Trend Insights – No Comments

The Silver Lining

October 19, 2009

As I mentioned in a post last month, I recently returned from the World Economic Forum’s “Summer Davos” meeting in Dalian, China. The event was very interesting and by gaining a better understanding of the challenges and opportunities facing my peers around the globe, I felt more informed about the international environment my business is operating in. And information leads to ideas.cloud

Interactive workspace sessions, like the “Maintaining an Innovative Edge” session that I was a facilitator for, provided a fantastic opportunity to explore the new concepts proposed by industry leaders, as were the talks headed by market-makers, academics and experts from all over the world.

A popular discussion topic that was of particular fascination to me was that of the ‘cloud’.

Cloud computing, and cloud services, are not a new focus for technology developers, but their practical use for business has leaders across all sectors and locations walking around Dalian with their heads in the ‘clouds’. As I listened to experts talk about the capabilities and possibilities on a broad scale, like any ambitious business owner, I began to think about what the cloud could mean for my customers?

In essence, cloud services aim to enhance user’s capabilities and capacities by hosting management tools online. With markets in the west having grown up in an international climate using a diverse range of hardware and software, integrating external cloud portals can often throw up compatibility issues. In China, the market is still young.

Right now, we have a unique relationship with China’s SMEs. DHgate has been working with these companies from the beginning, helping many of them enter the ecommerce sphere for the first time, and we have remained the driving force in their technological development ever since.

Many of the Sellers we have listed on our site have been with DHgate for several years and have experienced sales growth and logistical expansion under our platform. Comfortable in our space, these Sellers look to DHgate to provide CRM tools, sales analysis tools, order status analysis tools, HR management tools, etc. And Sellers who are well organized and supported provide a more professional and efficient service to their customers – our Buyers.

In short, they look to DHgate to provide not just as a transactional base for their businesses, but a business environment from which to run their day-to-day operations.

How can we leverage the cloud to grow our business offering?

I believe DHgate is in the best possible position to provide cloud services to Sellers. Firstly, because these businesses already work at DHgate we can anticipate their needs more intelligently than an external application can. Additionally, because these companies are already taking advantage of the platform based business management tools available on DHgate, the integration process would be far less intrusive and disruptive. I believe that by creating a DHgate cloud we will be able to dramatically reduce running costs for our Sellers businesses enabling them to pass on those savings to our Buyers.

I have always prided myself on the fact that DHgate is technologically unique, and by utilizing cloud computing, we can push the boundaries even further.

Does your business make the most of cloud computing? Please share your ideas and experiences on how both users and business can have the biggest impact.

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Raise Your Hand

October 14, 2009

When ecommerce first entered the mainstream, some questioned whether the general public would feel safe and comfortable selecting and paying for items online. Today, it’s common practice. In the US alone, ecommerce spend for 2010 is forecast to reach $177 billion.  But that’s not to say that all the fears have been put to rest. Because I run a company that facilitates global sourcing from China, entrepreneurs and small business owners from around the globe often ask me questions about the safety, feasibility and practicality of sourcing from abroad. And I like to give it to them straight.

Being open about how your company, the market and the environment you operate in works, I hope my customers will be able to not only develop trust in our service, but also become savvy and successful users.

I was recently interviewed by Practical Ecommerce about some of issues involved in sourcing from China. You can read my responses below and view the article here.

What other concerns do you think buyers might have when dealing with products made in China? I’d be more than happy to address them here on my blog.

DHGate.com Sources China-made Products

DHGate.com is an online markeplace of wholesale products from China. The company is located in Beijing and Diane Wang is its founder and CEO. Prior to launching DHGate, she founded Joyo.com, a consumer-shopping site that Amazon purchased in 2004.

She says that over a million customers use DHGate for sourcing China-made products. We asked her about DHGate and why non-China companies should buy inventory from there.

PeC: Why should smaller companies, from the U.S. or elsewhere, look to source inventory directly from Chinese suppliers?

Wang: “In the past, small businesses were left out [of importing products from China] because of the complexity of an outdated world trading system.

“Online platforms that streamline China-sourcing help revive and rejuvenate small retailers and wholesalers, leveling the playing field between the smallest businesses and the largest. The goal of such online marketplaces is simple: Make it as easy for a small business to buy products overseas as it is for a consumer to buy a book from Amazon.

“We’re seeing that now is the right time for this. The technologies are well developed and the markets are mature. Buying direct from manufacturers overseas is now safe, efficient, and can be even easier than ordering from a local distributor.”

PeC: How can a U.S.-based merchant know the quality of a China-made product?

Wang: “As with all industries in all countries around the world, there are always cases of poor management or lack of total oversight when it comes to quality. And just like in the U.S. or Europe, when serious quality issues arise in Chinese manufacturing, regulators step to assess the situation and put appropriate safeguards in place to protect consumers.

“One of the great things about the Chinese manufacturing sector is its size. That means there is a lot of choice for consumers. Buyers should always take the time to choose their suppliers carefully. The most important step buyers take in the process of selecting a source should be to check feedback about sellers. All reputable online platforms have built in review systems. You should also check open-ended comments posted by other buyers. The comments will tell a story about attitude, credibility, and the extent to which that seller is really focused on building a good reputation.”

PeC: What are the best items to import from China?

Wang: “I always recommend that merchants buy products that they know well and have an interest in. Since the goal is to resell items, it’s best to stick to what you know, even if those products won’t have the biggest margins. By focusing on products you’re really familiar with, marketing and managing your business will be much easier.”

PeC: How can it be cheaper to buy things from halfway around the world?

Wang: “One of the best things about the global economy is that it allows different countries, cities, businesses and individuals do what they do best. If you can imagine how much time and energy it would take if each household or individual had to produce all of the things they use each day—light bulbs, clothing, maybe an automobile or bicycle, the electricity to run appliances or a computer, it would be impossible for us to enjoy the quality of life we currently have. So different people do different work that they specialize in, and because they make more of the same things, they become more efficient making each item less costly to produce.

“Now if you take that example of a household that tries to be entirely self-sufficient and blow it up onto the global scale, you can see that some regions might be better suited to produce certain goods. For example, countries in arid regions import foodstuff and even water. In colder areas, roses from the southern hemisphere are delivered on Valentine’s Day. Because of a large workforce and major investments by both Chinese and international sources, China has become the world’s manufacturing plant.

“The amount of goods produced in China is astonishingly high. And with all that production, comes incredible economies of scale. So even if it costs more money to ship from Beijing to Boston, the items are available for purchase as such a low rate it becomes economically viable.”

PeC: How can a merchant know what, if any, products he or she should import from China?

Wang: “The first thing to do is plan how you’ll run your business and understand the time and money that will need to be invested. Second, do some research on the products you’d sell and find out what competition is already offering those goods. Decide how you’ll differentiate yourself. Finally, look into the different online platforms that streamline buying products from China. Important things to look for include the number of products and sellers, customer feedback and reviews, and any charges or fees that may be associated with a transaction. It’s also a good idea to see which platforms help ensure your satisfaction by having escrow or arbitration services.”

Posted in: DHgate, Personal Insights, Press – No Comments

Sourcing in China: The Challenges

October 12, 2009

Somebody’s dad once said “nothing worthwhile in life is easy.” I use this expression to keep our focus when making a new innovation that will make life easier for our buyers.

I’ve run across some blogs of folks who give interesting insights on sourcing in China, and one of those blogs is the Silk Road International Blog, run by a guy named David Dayton, who lives in China and inspects products in Chinese factories prior to export. There is a lot of brutal realism here, and sometimes the author gets a bit cynical, but all told you can see that he really believes that China can be a great place to buy great products. Check it out at http://silkroadintl.net/blog/.SourceCode

A somewhat different perspective is offered by Cyrill Eltshinger in his book Source Code China. Cyrill is one of those interesting people that make doing international businesses so much fun. He’s from Switzerland, where he was drafted into the Army and stayed long enough to become a junior officer in their special forces. After he left the Swiss Army (no knife jokes, please) he went back to college to get his degree – at Texas A&M.

If running into a Swiss Aggie in Beijing is not cool enough, he’s also written a book about his years running a Beijing company that wrote software for huge global corporations. His book has some superb insights about doing business internationally and in China, and is very much worth the read.

Posted in: Blog of the Month, Inspiring Reads, Know-How, Personal Insights – No Comments