Baigou New Town: What does cross-border e-commerce + industrial belt bring?

What does cross-border e-commerce bring?

Get closer to the market and let the brand go overseas quickly

At 10:00 on July 16, on the second floor of the Hebei Export Commodity Exhibition Center in Baigou New City, a Thai anchor introduced Baigou bags to fans. In less than 10 minutes, she promoted three fashionable leather bags suitable for local young girls through the TikTok platform, and the transaction amount and sales data were jumping in the background.

In this exhibition center, many settled enterprises are cross-border e-commerce sellers. Li Jiangtao is the operation manager of the exhibition center, who can provide warehousing, customs declaration, and foreign exchange collection services for settled enterprises.

Business opportunities are always reserved for people with insight.

Li Jiangtao, who transformed from the traditional foreign trade industry. As the situation of “customers asking for several cabinets” gradually decreased, he felt the decline of traditional foreign trade.

Wang Qiang, who transformed from domestic e-commerce. He has become the head of domestic e-commerce platforms and wants to find growth from overseas markets.

Li Jiangtao and Wang Qiang are representatives of the two main groups of people engaged in cross-border e-commerce in Baigou.

In the torrent of the times, the people of Baigou, who are sensitive to business, feel a “transformation force” driven by the wave of cross-border e-commerce.

Social media brings buyers and sellers closer together.

Li Jiangtao said that on the TikTok account of a cross-border e-commerce company they serve, a Thai customer suggested increasing the length of the shoulder strap of the bag. After receiving the feedback, the company conducted another survey and found that the local demand for large-capacity messenger bags was high. Therefore, they not only increased the length of the shoulder strap, but also increased the width to make it more comfortable for customers to use.

The speed of launching new products is extremely fast.

New products are launched every day, and a batch of new products can be produced in 3 days… Wang Qiang is “running all the way” on the road of innovation. Every day, more than a dozen young buyers in the company recommend popular elements from all over the world to designers to jointly create new products suitable for different countries and regions. Wang Qiang said: “There will be more hits only if there are more new products. Now, we are already the top sellers on multiple cross-border e-commerce platforms.”

Brand merchants are more favored by cross-border buyers.

In June this year, Li Jiangtao and the companies settled in the exhibition center attended the 2024 TikTok Shop Southeast Asia Cross-border E-commerce Annual Summit, and contacted many Southeast Asian Internet celebrities. He saw that the 179 domestic sellers invited to participate all brought their own brand products.

“In the traditional foreign trade form, small and medium-sized enterprises face buyers with higher voice, and the threshold for branding is very high.” Li Jiangtao said that through cross-border e-commerce platforms, enterprises can directly connect with overseas markets, allowing consumers to actively discover and choose brands, thereby driving brands to go overseas.

Adapt to changes. Baigou merchants have been innovating in the changing market and gradually grown into an important force on the cross-border e-commerce platform.

“On Alibaba International Station, there are more than 300 Baigou cross-border e-commerce sellers, which is equivalent to the number of sellers in many cities, which is not easy.” Zhang Jinjiang, head of the Baoding regional service provider of Alibaba International Station, said.

Zhang Jinjiang found that as more and more Baigou sellers entered the cross-border e-commerce field, the transaction volume also increased year by year. They opened up new markets and found new customers through cross-border e-commerce platforms. In this process, many high-quality enterprises have emerged. They are constantly shaping their own new advantages in brand development, digital transformation, etc., and are also leading the industrial belt to achieve capacity transformation and leap.

Why Baigou?

One-day delivery, one-piece delivery

South Yiwu, North Baigou. From “road market” to “China’s luggage capital” and then to the new track of cross-border e-commerce, why can Baigou do it?

Wang Qiang’s answer is “good goods”. Baigou luggage maintains cost-effectiveness while maintaining high quality, and has market competitiveness, which ultimately benefits consumers.

Many residential houses in Baigou New City have a wide courtyard gate to facilitate the entry and exit of trucks carrying raw materials and finished products. In the raw material professional market, trucks enter and exit in an orderly manner, and the latest raw materials are delivered to various production workshops.

To make a leather bag, you need to go through multiple links such as pattern making, cutting, compounding, and oiling, which requires a variety of raw and auxiliary materials such as leather, cloth, and hardware. After more than 50 years of development, all raw and auxiliary materials can be fully equipped in Baigou New City to complete all links of R&D design and production and manufacturing.

The efficient operation of the complete and smooth industrial chain supply chain has accelerated the production and iteration of products, which is exactly what the current “small order fast response” model urgently needs.

Unlike traditional foreign trade orders of tens of thousands of pieces, cross-border e-commerce platforms advocate the “small order fast response” model, often with only one or two hundred pieces in the first order, and then hundreds or thousands of pieces added according to market feedback, with a production cycle of only 7 to 15 days.

“In Baigou, the trial products can be ordered with a minimum of 200 pieces, and there are four colors for one style, and the cost can be within a controllable range, which is leading nationwide.” Wang Qiang was very proud of Baigou’s luggage industry chain. When he caught up with the hot products, he could cooperate with other factories to temporarily purchase additional raw materials, and the goods could be shipped as soon as one day.

Only when good products are sold can the complete closed loop of their value be realized. Sales have become a key link in the development of the industry.

Opposite the Crystal Domain Community on Baigou Park North Road, there is a famous street – “Net Supply Street”. The scale of the shops is generally not large, but the names of the shops all have the word “Net Supply”. They supply goods to online stores, provide design, production and other services, and can also do “drop shipping”.

More than ten years ago, local merchants of all sizes entered the era of Internet access on a large scale, and the Internet opened up a new domestic market for Baigou luggage.

After opening stores on Taobao, Tmall, Pinduoduo and other platforms for many years, Wang Qiang has his own experience in online sales, and entering the overseas market has become a natural thing. The export ratio of their products has gradually reached 70%. He said: “Compared with foreign platforms such as Pinduoduo’s overseas version Temu and Douyin’s overseas version TikTok, the logic of trade on domestic e-commerce platforms is the same, and foreign platforms are even simpler in terms of rules.”

“Alibaba International Station set up a service station in Baigou, and it also took a fancy to the strong Internet atmosphere here.” Zhang Jinjiang said that the collision and integration of Internet genes and Baigou industries have opened up new space for products to go overseas.

Through an Internet cable, Baigou luggage has moved from “selling nationwide” to “selling globally”. The Internet also puts higher requirements on the digital level of the industry.

In the digital production workshop of Jinchuan Musical Instruments and Bags Manufacturing Co., Ltd., each product is equipped with a bill of materials module, the cost structure of each bag can be accurately calculated, and the utilization rate of raw materials has increased to 94%.

Now, Baigou New City has created digital transformation demonstration enterprises such as Jinchuan Musical Instruments and Bags Manufacturing Co., Ltd. and Hengchang Zipper Co., Ltd., promoting enterprises to achieve automation in procurement management, production management, quality inspection management, warehouse management, sales management, etc. The Baigou Bags Industry Digital Transformation Empowerment Center has been in operation for more than 3 years, and has built 12 modules such as “Regional Enterprise Public Service Platform” and “Digital Transformation Diagnostic Platform” to quickly respond to corporate needs and achieve regional supply chain integration.

How to solve the “growing pains”?

“Invisible hand” and “visible hand” work together

Embarking on the high-speed train of cross-border e-commerce, Baigou luggage companies also have “growing pains”.

Talent has become a major constraint.

In Baigou, the monthly salary of cross-border e-commerce operators is linked to sales volume. The monthly salary of newly employed operators can reach 3,000 to 4,000 yuan, and the monthly salary of mature operators is over 10,000 yuan. Their income level is even higher than that of Baoding City.

Wang Qiang said that from recruiting secondary school students to recruiting college students, they recruited undergraduates for the first time last year. After joining the company, the undergraduate quickly mastered business skills and achieved good results. “The overall talent level of Baigou is improving, but there is still a gap compared with the demand.” Yan Xiaofei, director of the Convention and Exhibition Office of Baigou New Town, said that as a small town, Baigou’s living facilities are not as good as those of big cities, and it lacks sufficient attraction for young people. To this end, Baigou New Town cooperated with relevant vocational colleges in Baoding City to establish a “talent enclave”, placing the cross-border e-commerce training base in colleges and universities, innovating the knowledge and skills structure and training methods of talents, and cultivating cross-border e-commerce talents for the local area. In addition to introducing talents, Baigou New Town also attaches great importance to cultivating local talents. On July 10, the “Hebei Goods Going Out to Sea” International Trade Cooperation Matchmaking Meeting and Baigou Cross-border E-commerce Platform Procurement and Negotiation Meeting were held in Baigou New Town. The heads of cross-border e-commerce platforms such as Xiyin, Temu, and TikTok not only brought cooperation intentions, but also carried out business training for local practitioners. The “Foreign Trade Lecture Hall” held twice a month, long-term English training courses, and learning courses on major platforms help cross-border e-commerce companies, especially “novice” companies that want to do cross-border e-commerce, to master business knowledge faster.

In addition to talent, logistics is also one of the pain points. In the field of cross-border e-commerce, the efficiency of logistics can directly affect consumers’ shopping experience.

Cross-border logistics generally consists of three parts: the first leg, warehouse rental, and the last leg. For many cross-border e-commerce sellers, they face end consumers or small retailers. There are many such customers and their demands are scattered, making it difficult to form economies of scale. This makes them encounter high costs in the first-leg logistics link.

Now, if Li Jiangtao wants to send goods abroad, he needs to transfer and assemble in Yiwu, Zhejiang, and then send them abroad through China-Europe trains, airplanes, ships and other transportation methods. At the same time, he has set up border warehouses in Guangzhou and Guangxi, which can transport goods to the Southeast Asian market faster. But no matter which method is used, it requires a high capital investment.

In the final logistics link, overseas warehouses can sort, pack and deliver in time, bringing convenience to enterprises, which also requires a lot of capital investment.

When Wang Qiang first started cross-border e-commerce, a batch of women’s bags were sent to the official overseas warehouse of a platform. However, due to poor sales, more than 4,000 bags incurred a lot of storage costs, and finally had to choose to abandon this batch of products. At that time, he thought, if only he could have his own overseas warehouse.

For the demands of enterprises, the Baigou New City Management Committee is also seeking solutions. Yan Xiaofei said that last year, the Hebei Export Commodity Exhibition Center was established in the hope that through this platform, cross-border e-commerce sellers in the Baigou Industrial Belt and even cross-border e-commerce sellers in the province would be gathered together, forward warehouses would be set up in Baigou, and overseas warehouses would be built abroad, so as to drive enterprises to reduce logistics costs with scale advantages.

At present, 102 enterprises have settled in the exhibition center, and the Baigou New City (Luggage) Intellectual Property Rapid Protection Center can provide services to enterprises, help enterprises innovate, and escort “Hebei goods going overseas.”

The market and the government each play their respective roles and demonstrate their respective strengths. The “invisible hand” and the “visible hand” work together. The deep integration of cross-border e-commerce and industry in Baigou New City is exciting.