Inside knowledge on Chinese consumers
Popular online sale sites, the Chinese-developed WeChat app and fruit chain stores are all helping drive the increase in citrus exports to China.
Kurt Huang told delegates at the Citrus Market Outlook Forum in Sydney that the needs of Chinese consumers were being met in a variety of ways.
Mr Huang’s company, Shanghai Oheng Import and Export Co, provides a fresh fruit import clearance service in Shanghai. They own and are based in the Shanghai Huizhan Fruit & Vegetable Market, the biggest imported fruit wholesale market in East China.
Mr Huang said 90% of fruit imported in China is by import agents like him. They handle permits, clearance, logistics and funds transfer.
They are also familiar with emerging retail channel development, including online sales, fruit store chains, fruit factory stores and WeChat sellers.
Online sale sites, include Yiguo and Fruitday, which Mr Huang said are fighting intensively for market share (and burning through venture capital). There are also open platform sites like Taobao.com, provided by Alibaba, which provides a platform for anybody to have an online store.
Fruit chain stores are also developing at a rapid rate. The largest, Pagoda, has more than 1000 stores, while Xianfeng has more than 300 stores. Each is opening a new store throughout China almost every week.
“People working there are motivated to sell more to get more commission, this helps them to compete with the old style family store,” Mr Huang said. “The fruit is all packaged to help reduce wastage, the environment is much cleaner and the display more attractive.”
Fruit factory stores are slightly different, selling fruit by the whole box. They are often located in non-downtown locations. As they sell by the original carton, they have a low mark up and fast turnover.
“Families are happy to drive there and buy big boxes for lower cost, no one can resist low price” Mr Huang said.
WeChat, which provides 650 million active users with a business platform, a social media tool and a business platform, is changing the market dynamic.
“Almost everybody in China use WeChat on phone,” Mr Huang said.
Wechat sellers sell small portions of fruit through their social media. “Although these are small sales by each account, there are so many of them.”