What opportunities and risks do Chinese logistics supply chain enterprises face when going global?
What "opportunities and risks" do Chinese logistics supply chain enterprises face when going global?
Under the trend of cross-border e-commerce, how can Chinese brands grasp the "pulse" of global consumption and create new products that are suitable for overseas markets? In terms of logistics supply chain management, how can we ensure the stability, efficiency, and safety of the supply chain through technological and model innovation?
On October 18th, at the "China Enterprises Going Global: Where Are We Going? -2024 'Going Global Pioneer' Closed Door Salon" organized by the Daily Economic News and specially planned by the Future Business Think Tank, Yao Xiaowei, CMO of Ruiyun Cold Chain, Wu Bo, General Manager of North China Region of Best Group, Wu Jialu, Vice President of Public Relations and Public Affairs of "Make Friends", and relevant personnel from JD Logistics International Business Unit conducted in-depth discussions on the above issues.
In the past two years, companies such as Ruiyun Cold Chain, JD Logistics, Best Group, and "Make Friends" have achieved certain results on the road to going global, providing valuable experience for other enterprises. However, issues such as talent shortage and localization remain the challenges they face.
Facing the future, how can excellent Chinese enterprises continuously optimize their products and services, deepen their localization strategies, and strengthen cooperation with global partners? In this process, enterprises need to have strong decision-making and risk resistance abilities, integrate resources, and use high technology to improve their operational and business efficiency.
Seeking more opportunities and profit margins
With the intensification of domestic market competition, various industries have turned their attention to overseas markets, seeking more opportunities and profit margins. What are the new opportunities for overseas markets in 2024? How will Chinese enterprises change the international market competition pattern?
Yao Xiaowei stated that in the first four months of going global, Ruiyun Cold Chain mainly focused on finding resources and laying foundations, and the investment during this period laid a solid foundation for the explosive growth that followed. Especially for the Thai and Vietnamese markets, Ruiyun has completed line integration and system optimization before the fruit peak season from February to September each year, ensuring efficient operational efficiency. According to him, the international business revenue of Ruiyun Cold Chain is currently growing rapidly.
Baishi Group went global almost at the same time as JD Logistics. Wu Bo also introduced the company's path to going global: currently, Baishi Group has 33 express distribution centers and over 1000 service outlets in Southeast Asia, while also expanding overseas warehouses in the United States and Southeast Asia, providing services to many Chinese and local enterprises.
In recent years, there have been significant changes in China's logistics going global, especially in the Southeast Asian market. In Wu Bo's view, compared to China's development stage, Southeast Asia is currently in the early stages of domestic reform and opening up and e-commerce development. This also means that in the future, with the entry of more foreign-funded enterprises, Southeast Asia will usher in a period of explosive opportunities in industries such as e-commerce and logistics.
Chinese brands have expanded their business to overseas markets through brand expansion, production capacity expansion, excellent operational scale, sales processes, and supply chain rules.
This provides huge opportunities for Chinese logistics companies, and while Chinese logistics companies help Chinese companies go global, they also improve local supply chain and logistics levels, "said Wu Bo.As one of the main service targets of logistics companies, leading enterprises in live streaming e-commerce are also exploring the path of internationalization, and Chinese products and live streaming rooms are moving towards a broader market. The first live streaming sales GMV (total transaction volume) of "Make Friends" in the US market exceeded one million US dollars. Wu Jialu stated that "Make Friends" has recently opened offices in the United States and the United Kingdom, and has collaborated with TikTok on a Showcase in the United States.
In China, live streaming e-commerce enjoyed dividends in the past few years, and competition was relatively less intense. However, with the intensification of domestic market competition, many companies have begun to explore overseas markets. However, the return rate of live streaming e-commerce is high, and supply chain capability is also an important ability that must be considered in the process of going global, "said Wu Jialu.
Domestic experience cannot be directly transferred to foreign countries
Going global inevitably faces storms and challenges, and almost all enterprises must properly deal with a series of issues such as cross-border challenges, data management, language translation, and localization during the process of going global. So, what is the biggest challenge that most companies face in the process of going global? How can companies avoid risks when going global?
Yao Xiaowei admitted that talent shortage has always been a problem faced by Ruiyun in its process of going global. Talent in the domestic cold chain industry is scarce, and with the addition of talent in the entire cross-border cold chain industry, it is even more difficult to find one person, "Yao Xiaowei exclaimed on site. In addition to the shortage of talent, Yao Xiaowei also mentioned the management issue of foreign personnel. Foreign personnel are completely different from domestic personnel and need to have a better understanding of the local customs and traditions.
When it comes to going global, localization is an unavoidable keyword, and many companies have also done their homework in the localization process.
The person in charge of JD Logistics mentioned that the categories of logistics transportation and storage are quite diverse, even including dangerous goods. The requirements for these dangerous goods vary from country to country, and some countries even do not allow imports. This requires prior understanding of local laws and regulations.
The person in charge of JD Logistics also specifically mentioned that in order to prevent international product returns and exchanges from being detained, JD Logistics will handle returns and repairs through overseas warehouses, reduce customer costs, and help brand owners go global as much as possible.
Wu Bo also mentioned the importance of talent cultivation in the process of going abroad. In his opinion, it is not enough to simply transfer Chinese experience directly to foreign countries. It is still necessary to optimize and improve domestic experience based on local market characteristics and policies and regulations.
In the long run, if we want to explore overseas markets, we need to send good Chinese teams to important overseas markets, while also cultivating local talents. Only when local talents are fully integrated with our own talents can a reasonable team maintain sustained and long-term service in the local area, "said Wu Bo.
Where is the cross-border shipping route?
Going out to sea is difficult, but it must be done. Going out to sea presents challenges, but also contains infinite opportunities. What is the future path for cross-border new forces to go global? What are the "Avoiding Pits Guidelines"?
The executive team of Ruiyun Cold Chain conducted a six-month inspection before going global. Yao Xiaowei shared that all companies must do a lot of data analysis and research in the early stage of going global. During the research process, it is very important to understand what can be done and what cannot be done. In addition, going global requires the company's management to have strong decision-making and risk resistance abilities.
He also stated that when going abroad, it is necessary to integrate resources and cooperate with local foreign companies. "Local logistics companies that can survive in the local area actually have a certain level and ability. A new company that is new to the international market needs to have some adaptation time and may even be limited by policies, laws, and other factors. Therefore, it is necessary to cooperate with local companies or establish overall connections and partnerships with international companies.
Wu Bo mentioned that in the era of technological development and artificial intelligence, logistics has become a high-tech industry, with massive amounts of data generated on logistics platforms every day. Therefore, logistics companies must use high technology to improve their operational and business efficiency. He also stated that the company needs to pursue long-term development, and the team remains the most important. It must be sending your elite soldiers outside, and we need to cultivate local talents soon, because they are the most down-to-earth and understand the local situation
The person in charge of JD Logistics added that the overall trend of going global this year is standardization and legalization, and the most important thing for logistics companies to go global is legality and compliance. For the overseas expansion of Chinese brands, JD Logistics will vigorously carry out some industrial belt linkage in the future, and make more compliant overseas plans around the industrial belt.
Previously, it was said to copy to China, but in our live streaming e-commerce industry, the situation is completely reversed. After our operational and live streaming strategies were directly copied to the United States, the GMV output of a live streaming room in the United States used to be $2000 per hour, but after the transformation of operational strategies, it increased tenfold. In Wu Jialu's opinion, in the live streaming e-commerce industry, going abroad is more about using domestic live streaming experience to directly influence foreign countries. In his view, in the future, Chinese companies can leverage and stack with each other to achieve "1+1 greater than 2" when going global.
