SHEIN sellers in the era: catching up, innovating, and breaking out in the wave of going overseas

For Chen Qiao, who seized the overseas business opportunity in the cross-border e-commerce SHEIN and completed his first entrepreneurial project in 2020, the domestic policy guidance encouraging enterprises to go overseas in recent years has been the "God of Wealth" that has turned his life around, and the vast overseas consumer market is his "blessed land".

Chen Qiao was originally a middle manager in a Fortune 500 foreign company. After more than a decade of working as a white collar, Chen Qiao felt very tired. If he continued to work like this and became a veteran in the workplace, and lost his life goals and passion for struggle, what would be the point? Later, when he saw a friend making money by selling beauty brushes, he was also tempted and started to do some e-commerce part-time, wholesale beauty brushes, beauty eggs and loose powder puffs and then sell them through e-commerce platforms, thus embarking on his own business.

In 2020, Chen Qiao heard that a company called SHEIN had started cooperating with third-party sellers and they could go global together. Chen Qiao, who already had experience in the e-commerce field, chose to seize this new opportunity and set up his own company to run it. In just three years, Chen Qiao's entrepreneurship entered a high-speed development track. From "Xiao Bai" to "Mr. Chen", Chen Qiao can sell 20 million products a year, and his life has changed since then.

However, in the eyes of more ordinary manufacturing factories and sellers in China, the overseas market is still like a deep ocean. But now with the wave of cross-border expansion, choosing the right platform can make going overseas "more efficient" .

Cross-border e-commerce in 2023: the awakening, struggle and independence of manufacturing companies

In 2023, the US e-commerce industry experienced its slowest growth since the 2009 recession. Although Amazon accounts for 40% of the US e-commerce market, it only accounts for 4% of the country's entire retail industry. Not to mention other overseas markets and those overseas countries and regions that are more sinking. In other words, compared with the penetration rate of domestic e-commerce, the other side of the ocean is still a vast blue ocean suitable for doing business.

Since 2014, the first year of cross-border e-commerce, Chinese manufacturing factories and cross-border sellers have been connected to the macroeconomic situation of the manufacturing industry on one end and hundreds of millions of overseas consumers on the other end, and they are the fundamental force that jointly promotes the development of the industry. However, the overseas model of most domestic enterprises still faced great uncertainty for many sellers until last year : unstable sales channels, the risk of orders being cancelled by foreign companies at any time , and the lack of understanding of overseas consumer needs ...

In addition, traders’ practices of buying and selling goods lack uniqueness and innovation, which intensifies homogeneous competition and leads to fierce price wars. At the same time, some cross-border sellers are weak in brand building, lack of popularity and reputation , and find it difficult to gain long-term trust from overseas consumers and obtain loyal repeat purchases.

How to build a stable and sustainable cross-border business is not only a need for domestic factories and sellers to generate revenue , but also the foundation for making the hard-earned cross-border business opportunities bigger and better.

"SHEIN is a giant with huge global e-commerce and social network influence. SHEIN has more followers on Instagram than Amazon and Walmart combined." Chen Qiao first felt that the hundreds of millions of young fashion consumers gathered on SHEIN were the most suitable users for him, and he didn't even need any additional screening costs. SHEIN has a sensitive touch to the global market. It not only pays attention to fashion trends, but also studies market preferences in different regions and cultural backgrounds . These proven market experience accumulations have enabled SHEIN to quickly capture subtle new market changes and promptly inform sellers to adjust products and market strategies to ensure that sellers are always at the forefront of consumer trends.

Secondly, SHEIN's own familiarity with cross-border supply chains is almost perfect. Traditional single-handed mature cross-border e-commerce companies are inevitably constrained by complex international logistics and inventory backlogs, while the SHEIN-style on-demand model has been successful for a long time, not only providing a full demonstration for many subsequent cross-border operators, but also greatly reducing the operating risks of sellers on the platform, improving the efficiency of operating operations, and thus improving overall profitability. Wang Yongxin, who has experienced many cross-border setbacks, also told the media that he has gone through a lot of wrong paths in the nearly 10 years of engaging in large-size clothing production. For example, he once spent a lot of money to build an independent website and build his own operation team, but ended up with nothing. Until he joined the SHEIN platform in September last year, Wang Yongxin lamented that he had caught up with the best time: he did not need to build a site by himself, did not need to market himself, did not need to deal with overseas logistics and after-sales, and could sell products quickly. "I used to worry about not having a tomorrow after completing an order, but now I finally don't have to worry about it."

In addition, Chen Qiao discovered in his business that price advantage alone is no longer enough to attract consumers, and the SHEIN platform will focus on helping sellers establish unique brand characteristics and impress consumers with their uniqueness. This leverage and shaping of the sellers' potential brand power makes SHEIN more than just a sales platform for him, but also the confidence and confidence to move towards success.

"Made in China is changing from 'Made in China' to 'Marketed by China'." Juozas Kaziukenas, founder of Marketplace Pulse, a well-known American e-commerce intelligence company, mentioned his feelings in a blog. If the contribution of cross-border sellers such as Chen Qiao and Wang Yongxin to the manufacturing industry is to open up the diversified supply of "Made in China" overseas, then the cross-border open platform represented by SHEIN is the pioneer in launching the Chinese PnP "Marketed by China" action.

Following the market is the way for enterprises to break through and grow overseas in the new stage

Fortune magazine in the United States once reported that the average lifespan of small and medium-sized enterprises in the United States is less than 7 years. According to some public data in China, the average lifespan of small and medium-sized enterprises in China is only 3 years, and the average lifespan of group enterprises is only 7-8 years - this means that even if a company is at the peak of its business development, it is easy to decline and disappear if it does not make good preparations and lay the foundation for long-term operation.

Therefore, keeping up with the trends of global business and maintaining a certain level of creativity is an inevitable requirement for those who want to expand overseas and maintain a long-term business. This is also the ideal of many domestic small and medium-sized enterprises, not just to eat a meal at the outlet of the wind.

Some media believe that the "front shop, back factory" of the real economy and the "front electricity, back factory" of the e-commerce era have failed to change the nature of supply and demand: the manufacturing industry with factories as the core produces goods according to the will of the enterprise, and the retail end with stores as the core tries to sell goods, and consumers' needs are vaguely met. The emergence of Internet e-commerce has moved stores online, but it is SHEIN that has truly changed the manufacturing industry.

Luo Jie has an accessories factory in Dongguan, Guangdong. She believes that the biggest difference between doing overseas business through the SHEIN platform and doing traditional foreign trade is the products. Before SHEIN, she supplied goods to offline traders, and a lot of inventory was accumulated during the epidemic. She made whatever style others said, and she didn't need to know what products actually sold well, nor did she know when the next order would come. After opening her own store on SHEIN, Luo Jie found that there would be someone to guide her and she would decide what style to make. She would make 50-100 of each new product first, and then continue production when she saw sales pick up. Constantly develop new models, check market sales every day , follow the data, and maintain low inventory and high sales. The essence of this difference is that cross-border sellers are forming a more digital and concrete insight into overseas consumer demand.

Risks and opportunities are written on two sides of the same coin. There is still a long way to go for Chinese SMEs to go overseas. Factories, sellers and platforms, all parties in the industry must "share the prosperity" and "share the adversity". More and more factories and sellers are going global through cross-border e-commerce platforms such as SHEIN.

The above-mentioned stories of small and medium-sized enterprises' successful overseas expansion will not be isolated cases. Those companies that can deeply understand the global market, continuously innovate supply chain management, and focus on brand building are still competing to "go global" to fulfill their dreams of global layout while bringing rich and diverse Chinese product experiences to global consumers.

The impact of this trend is also far-reaching. Behind it is a reflection of the overall development trend and changes of Chinese companies going overseas: to get rid of the path dependence of the traditional overseas model, to have the courage to let good money drive out bad money, to form the profitability of global involvement, to have global innovation capabilities, and to achieve long-term development of the industry.

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