Export spotlight: Tapping China’s e-commerce opportunities

Image credit corporate.jd.com:  Sorting robots at JD’s automated warehouse.

JD.com’s new Melbourne headquarters is helping Victorian businesses access more than 292 million new customers in China, and putting Victoria front and centre as an e-commerce leader.

One of China’s largest online retailers with an $AU71.6 billion revenue, Beijing-based JD.com, has set up its Australian and New Zealand headquarters in Melbourne’s Collins Street, helping local businesses sell products – including healthcare, food, dairy, beef, vitamins, electronics, clothing and books – to its 292 million-plus online users.

That massive, and indeed ever-growing, user base is attributable to China’s growing middle class, and Victoria is well poised to benefit in terms of export earnings.

A man in a suit smiling at the camera“With rising disposable incomes in China, our consumers are demanding the best products from all over the world,” says Winston Cheng, JD.com’s Head of International, “and our intention is to build the relationships we need to deliver that to them.”

While its primary focus currently remains on China with more than 480 warehouses covering 99 per cent of the country’s population, JD.com is consciously expanding its international footprint. “We’ve opened in Europe, the United States and now Australia to get closer to our brand partners,” Cheng says. The response to date has been enthusiastic, to say the least. “Australian brands are already very popular with Chinese consumers, [most notably] in wine, beef, dairy and health care products. We’re excited to help more Australian brands and merchants to better understand and tap into China’s massive market and provide them the resources they need to maximise their sales.”

In particular, Victoria’s e-commerce relationship with China is firing all cylinders. In 2016-17, the total two-way trade between Victoria and China was worth $23.4 billion and that demand is seen first-hand in strong online sales for Victorian-based businesses such as SwisseGoat Soap and Ego Pharmaceuticals. It’s a sure sign that cross-border e-commerce is rapidly becoming a preferred platform for Victorian businesses keen to access new global markets simply, safely and without needing to set up bricks and mortar stores in another country.

“Victoria has become a major hub for e-commerce,” says Cheng. “Access to an abundance of local suppliers, Australia’s only 24-hour shipping port and the supportive Victorian Government make the state an ideal jumping off point for Australian and New Zealand (ANZ) business. We’ve already been working closely with the state to tap into the massive e-commerce opportunities.”

Huge scope exists for health-focused businesses, he points out, as customers in China “care more about their health and wellness today than ever, and Victoria’s business’ reputation for quality, and authenticity makes them hugely attractive to our customer base.”

Ditto beef and dairy. “Australian beef and dairy are a huge draw for Chinese consumers looking for high quality products – something Victoria is known for,” Cheng notes. “With our presence on the ground, we’ll be able to help local producers reach the Chinese market and meet this growing demand. We can leverage our immense resources in logistics, branding and marketing to strengthen and promote the trading relationship between the ANZ region and China. Our goal is to make it as easy as possible for Australian brands to physically get their products to China and to increase brand awareness among consumers.”

Read Trade Victoria’s summer 2018 China update