The best-selling product has an annual sales volume of nearly 400,000 units, and Amazon's performance has soared in East China

In addition to Guangdong and Shenzhen, there have been many reports of sellers in East China going public recently. Zibuyu Group Co., Ltd. (hereinafter referred to as Zibuyu) from Hangzhou, Zhejiang, resubmitted its listing application to the Hong Kong Stock Exchange on March 7 this year after its application failed on June 30 last year .

Revenue exceeded 2.3 billion yuan, and the annual sales of popular products reached 378,000 pieces

As one of the largest cross-border e-commerce sellers in China, Zibuyu mainly sells clothing and shoes. Female customers aged 18 to 45 are its main target group. Since 2016, the company has won the "Best Cross-border E-commerce Brand Award" consecutively.

Since its establishment in 2011, Zibuyu has focused on the design and sales of apparel products, especially women's clothing, including sweaters, T-shirts, jackets, skirts and sportswear. Since 2016, it has expanded its product category to sell footwear products. In 2018, through the operation of its own website, footwear sales have increased significantly. In recent years, it has begun to provide other products such as electronics.

Over the years, Zibuyu has created many best-selling brands. In 2021, its hit brand Emily

Bela, Runcati and Dellytop were selected as "Famous Zhejiang Cross-border E-commerce Export Brands".

Imily Bela is a women's sweater brand and a best-selling brand on Amazon. In 2021, the brand sold more than 378,000 products. The casual men's clothing brand Runcati mainly sells cotton and linen shirts, men's pajamas and sweatshirts. The women's clothing brand Dellytop mainly sells women's tops. Other brands include sports brand Aurgelmir and shoe brand Jolimall.

Since 2012, ZiBuYu has started selling through third-party e-commerce platforms, including Amazon, Wish, eBay, AliExpress, etc. Its market scope covers more than 80% of countries and regions in the world , with the United States and Germany accounting for the highest proportion.

From 2019 to 2021, Zi Buyu's annual revenue was approximately RMB 1.429 billion, RMB 1.898 billion, and RMB 2.347 billion, respectively , and its annual profit was approximately RMB 81.1 million, RMB 114 million, and RMB 201 million, respectively. Both revenue and profit increased year by year.

In 2019, 2020 and 2021, the revenue generated by Zibuyu through third-party platforms was RMB 1.313 billion, RMB 1.506 billion and RMB 2.052 billion, respectively, accounting for 91.9%, 79.3% and 87.5% of the annual total revenue, respectively, of which Amazon and Wish accounted for the vast majority.

Amazon's North American market revenue reached 2.029 billion, and its performance soared

As one of the giants in the cross-border apparel and footwear market, Zibuyu 's products have been sold to more than 80% of the countries and regions in the world , but the revenue and share of each major market and platform are different.

In terms of the market, North America accounts for the largest share, followed by Europe and Asia. According to relevant data, from 2019 to 2021, Zibuyu's sales in the US market accounted for an increasing proportion, while Europe's share decreased year by year. Zibuyu said that this was due to the company's strategic considerations to focus on the North American market and the decrease in European purchasing users.

Data shows that in 2021, Zibuyu's total revenue in North America reached 2.029 billion yuan, accounting for 86.5% of the total revenue, of which the revenue from the US market alone reached 2.007 billion yuan, accounting for 85.5% of the total revenue. The total revenues of the European and Asian markets were 238 million yuan and 50.1 million yuan, respectively, accounting for 10% and 2.1%, respectively. Germany, the United Kingdom and France ranked in the top three in the European market.

In this prospectus, Zi Buyu stated that they plan to actively expand into Southeast Asian and European markets by combining third-party e-commerce platforms and self-operated websites , thereby gradually reducing their dependence on the US market.

In terms of online sales, based on the natural advantages of Amazon, Wish, AliExpress and other third-party e-commerce platforms, Zibuyu's sales have entered a period of rapid development. Compared with the past, due to the adjustment of the company's business, Zibuyu's sales on major e-commerce platforms in 2021 have changed, and sales growth on the Amazon platform is particularly obvious.

Data shows that by expanding its business on the Amazon platform, Zibuyu’s new products and best-selling products have seen a significant increase in sales on Amazon, which has increased Zibuyu’s revenue from the Amazon platform from 615 million yuan in 2020 to 1.672 billion yuan in 2021, with a gross profit of 1.265 billion yuan.

However, the company reduced sales of low- profit margin products through Wish and shifted its focus to sales on other third-party e- commerce platforms (especially Amazon ) . As a result, the gross profit margin from Wish increased from 70.6 % in 2020 to 75.0% in 2021, while the number of orders, sales revenue and number of active users also declined.

Wish platform revenue was 304 million yuan, with a gross profit of 228 million yuan. Its self-operated website revenue reached 257 million yuan, with a gross profit of 209 million yuan, and a gross profit margin of 81.3%, which was a decrease in revenue and gross profit compared to 2020, both of which decreased by more than 25%.

Although it has earned a lot of money from third-party platforms, its dependence on third-party platforms has also created potential risks for Zibuyu's future development.

Third-party platforms account for a large proportion of revenue, and the market prospects are too broad

Relevant information shows that Zibuyu mainly sells its products to more than 80% of countries and regions in the world (including the United States , Germany , France and Japan) through third-party e - commerce platforms and its own websites .

In 2019, 2020 and 2021, Zibuyu's revenue through third-party e-commerce platforms was approximately RMB 1.313 billion , RMB 1.506 billion and RMB 2.052 billion , respectively , accounting for approximately 91.9 %, 79.3% and 87.5% of the total revenue in the same year , respectively .

The total revenue through Amazon and Wish was approximately RMB 1.229 billion , RMB 1.456 billion and RMB 1.977 billion , respectively, accounting for approximately 86.0 %, 76.7% and 84.2% of the total revenue in the same year , respectively .

From the above data, it can be seen that in recent years, the annual income of third-party e-commerce platforms has accounted for more than 70% of ZiBuYu’s total revenue. According to ZiBuYu’s expectations , sales through Amazon and Wish will continue to account for the vast majority of total revenue in the future .

Therefore, third-party e-commerce platforms , especially Amazon and Wish , have a huge impact on Zibuyu . Once any adverse changes occur on these platforms, it will have a significant impact on the company 's business and operating performance .

If the service fees charged by third-party e-commerce platforms increase significantly , or if consumer orders from third-party e-commerce platforms decrease significantly , or if third-party e-commerce platforms modify the terms of the agreement to the disadvantage of sellers , Zibuyu 's profitability will be threatened .

In addition, third-party e-commerce platforms update their policies from time to time , and changes in their policies may also require Zibuyu to change its operating rules; third-party e-commerce platforms may even suspend or even shut down the accounts of online store sellers and withhold sales proceeds for a period of time , all of which may pose a threat to Zibuyu's revenue.  

The United States is Zibuyu's largest overseas sales market . In 2019, 2020 and 2021, Zibuyu's revenue in the US market was approximately RMB 840 million , RMB 1.31 billion and RMB 2.007 billion , respectively , accounting for 58.8%, 69.0 % and 85.5% of the total revenue in the same year , respectively .

Zibuyu expects that in the short term, sales contribution will still be mainly concentrated in the U.S. market . If consumers' consumption patterns change significantly and Zibuyu is unable to effectively respond to market changes, it will have an adverse impact on Zibuyu's business and finances .

In addition, the replacement cycle of fashion consumer goods is short , and if Zi Buyu is unable to promptly meet the ever-changing consumer preferences in terms of design and production, including patterns , fabrics and other elements, fails to accurately predict fashion trends and respond to current consumer preferences in a timely manner , resulting in obsolete inventory , it may have a significant adverse impact on its business , financial condition and operating results .

In addition, inventory levels and logistics services provided by third parties also have a significant impact on Zibuyu's operations. If customer needs cannot be met , the company's business , financial condition, operating performance and prospects will face major threats.

However, from the perspective of China's cross-border e-commerce industry as a whole, the development momentum of the apparel and footwear industry is still very impressive . Among the categories of China's cross-border export B2C e-commerce industry , consumer electronics, apparel and footwear, and home products are the three largest markets . Among them, the apparel and footwear industry is an important part of China's cross-border export B2C e-commerce industry.

With the development of online sales and the continuous improvement of consumer income levels, the market share of apparel and footwear in the cross-border export B2C e-commerce market has steadily increased from 14.6% in 2016 to 25.2% in 2020, and is expected to further increase to 29.5% in 2025, and is expected to continue to maintain the growth trend in the next few years .

According to relevant data, the market size of China's cross-border export B2C e-commerce apparel industry increased from 79.1 billion yuan in 2016 to 462 billion yuan in 2020, and is predicted to reach 1,091.6 billion yuan by 2025, with a compound annual growth rate of 18.8% from 2020 to 2025.

Among them , the United States, Canada, Germany, France, the United Kingdom, Italy and Spain have always been the main markets for cross-border e-commerce apparel and footwear industries . The United States is the market with the largest retail sales , followed by Germany and the United Kingdom .

Today's consumers have diversified demands for clothing and footwear products. Generally speaking, customers purchase such products much more frequently than other consumer goods, and products with high quality and excellent design are more popular with consumers. This category still has huge market demand, and relevant practitioners can seize opportunities and develop based on understanding the market.

Cross-border sales

The best-selling product has an annual sales volume of 378,000 pieces

Amazon's performance soared