China taking over Amazon

[Denim Chicken]

I follow this channel strictly for better learning about Chinese culture esp in the context of business. They're just vloggers that live in china and have for 10 years or so, so I thought their perspective was interesting.

Tldr:
- China has a competitive edge when it comes to sourcing and selling on amazon and Chinese sellers are selling all over the world on Amazon, not just Amazon.cn
- European Amazon has a rule that requires sellers to show their country whereas U.S. does not. According to a study, 25% of european amazon sellers are of Chinese origin. U.S. most likely has a higher %.
- The video reaffirms the idea that gone are the days of strictly importing Chinese goods and private labeling. You will never be able to sustain the product long-term if your product isn't unique in some way, whether it's a patent, a creative or unique solution or your own loyal branding.



IMO:
China has already started going direct to Amazon. China's protectionist policies hinder foreigners from entering China and conducting business in China and make it harder for outsiders to do business inside China.

While I'm waiting 2 weeks to a month for samples and going back and forth with communication barriers, a Chinese citizen can walk down the street, get easily in contact with someone they know who has factory ties, visually inspect the product the same day and have products within a week to sell.

The things that come to my mind when it comes to protecting your product or business is choosing something that not only has value but also requires an understanding of domestic culture.

Marketing and communication still is far lacking for Chinese sellers. Chinese sellers have not been able to launch their own stores and drive effective traffic using ppc or email marketing and flood ecommerce in general, even though it's been around for ages on Google.

Only certain products and niches are acceptable to be cheap, Chinese quality. Other things like supplements or food, is not conducive to giving the Chinese advantage in production.

Protect yourself in other ways besides what traditional AMZ courses preach which is to pick an item based on a certain BSR. Your traffic, your branding, your customer loyalty, your product's solution to a problem needs to be all taken into consideration and tilted to your advantage if you want to offset the potential price cut from a Chinese competitor.

 

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[biophase]

I just came back from China. I spent 8 days there sitting at 2 factories designing products. While the Chinese may have this advantage, they are at a disadvantage of understanding their own product. A factory just makes stuff out to a customer's specs. They do not know why something is there.

For example, I was explaining the MOLLE system on tactical gear. For someone who has never seen, let alone touched a gun, they have no concept of why the molle straps are there. I explained that they needed to be a certain spacing and size in order for mag pouches sold by other company's to fit them. Then I had to explain what a mag pouch was, what a magazine was, an AR15, etc...

What was really cool was how my sample process went.
Day 1 - Sit down, talk, look at products, go to market, look at fabrics and material, purchase material
Day 2 - Leisure day while factory 1 is making a sample for me. Visit factory 2, do the same thing.
Day 3 - Inspect completed samples, adjust, go to market, purchase material
Day 4 - Samples ready at factory 2, inspect, adjust, etc...
Day 5 - Sample perfect, place production order factory 1
Day 6 - Sample perfect, place production order factory 2
Somewhere in there I also went to the Canton Fair.

Now things didn't go as planned as some samples needed more iterations, but I got the bulk of the hard work and hard to communicate stuff changed. I also took the samples home. I think I completed about 2 months worth of work in 1 week. Normally, I would have worked on 1-2 products at a time, going back and forth. But since I was there, I worked on over 10 products at the same time. The factory sample maker probably didn't like seeing me.

Now that I'm home, I just came up with a redesign that would make the product better. I wish I was still there, because it is so much easier explaining things in person with the product right in front of you. I could have this redesign in my hand in 24 hours. Now I will have to do it the old fashion way, through skype and email and photos and wait over 1 week to see if they understood me correctly.

 

[GoodluckChuck]

I just came back from China. I spent 8 days there sitting at 2 factories designing products. While the Chinese may have this advantage, they are at a disadvantage of understanding their own product. A factory just makes stuff out to a customer's specs. They do not know why something is there.

For example, I was explaining the MOLLE system on tactical gear. For someone who has never seen, let alone touched a gun, they have no concept of why the molle straps are there. I explained that they needed to be a certain spacing and size in order for mag pouches sold by other company's to fit them. Then I had to explain what a mag pouch was, what a magazine was, an AR15, etc...

What was really cool was how my sample process went.
Day 1 - Sit down, talk, look at products, go to market, look at fabrics and material, purchase material
Day 2 - Leisure day while factory 1 is making a sample for me. Visit factory 2, do the same thing.
Day 3 - Inspect completed samples, adjust, go to market, purchase material
Day 4 - Samples ready at factory 2, inspect, adjust, etc...
Day 5 - Sample perfect, place production order factory 1
Day 6 - Sample perfect, place production order factory 2
Somewhere in there I also went to the Canton Fair.

Now things didn't go as planned as some samples needed more iterations, but I got the bulk of the hard work and hard to communicate stuff changed. I also took the samples home. I think I completed about 2 months worth of work in 1 week. Normally, I would have worked on 1-2 products at a time, going back and forth. But since I was there, I worked on over 10 products at the same time. The factory sample maker probably didn't like seeing me.

Now that I'm home, I just came up with a redesign that would make the product better. I wish I was still there, because it is so much easier explaining things in person with the product right in front of you. I could have this redesign in my hand in 24 hours. Now I will have to do it the old fashion way, through skype and email and photos and wait over 1 week to see if they understood me correctly.

Time to send cousin Jimbo over to live in China!

 

[Mr.Chaos]

To add on to what Bio stated.

I have been writing copy for a Chinese factory, I presume to look into getting into amazon us and uk. They had almost no knowledge of what made what they were selling marketable to a customer......zero. I practically had to walk them through the entire sales process just to explain why they should offer a guarantee on their product....and they still message weekly asking why they do not have many sales.

 

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[CycleGuy]

Sounds like there is a need for American marketers to learn Chinese then sell their marketing skills to Chinese direct sellers. Maybe even someone like Andy could provide direct courses to Chinese marketers who speak English since they are having issues grasping the paid marketing aspect.

 

[Denim Chicken]

It's much harder for Chinese sellers in china to set up everything ecommerce here, they don't have access to google or youtube and that only separates our culture from theirs further. I bet there isn't a single ebook or video course on adwords in Chinese. Why would there be? They don't have google.

But Amazon, like any marketplace, makes it easy to list and sell. So the low hanging fruit will go to the Chinese sellers should they decide to make an effort at it. Where they currently lack is everywhere else.. Facebook ads, copy writing, email marketing, etc.

Guess the point is, start a business not an amazon product if you want to stay alive.

 

[CommonCents]

ha, so true, i've been dinking around for 3 mos trying to get right samples for fairly straightforward components. It could be nearly cheaper (time and money) to travel there to conduct business by the time you have a few iterations of samples plus sample/shipping fees.

I just came back from China. I spent 8 days there sitting at 2 factories designing products. While the Chinese may have this advantage, they are at a disadvantage of understanding their own product. A factory just makes stuff out to a customer's specs. They do not know why something is there.

For example, I was explaining the MOLLE system on tactical gear. For someone who has never seen, let alone touched a gun, they have no concept of why the molle straps are there. I explained that they needed to be a certain spacing and size in order for mag pouches sold by other company's to fit them. Then I had to explain what a mag pouch was, what a magazine was, an AR15, etc...

What was really cool was how my sample process went.
Day 1 - Sit down, talk, look at products, go to market, look at fabrics and material, purchase material
Day 2 - Leisure day while factory 1 is making a sample for me. Visit factory 2, do the same thing.
Day 3 - Inspect completed samples, adjust, go to market, purchase material
Day 4 - Samples ready at factory 2, inspect, adjust, etc...
Day 5 - Sample perfect, place production order factory 1
Day 6 - Sample perfect, place production order factory 2
Somewhere in there I also went to the Canton Fair.

Now things didn't go as planned as some samples needed more iterations, but I got the bulk of the hard work and hard to communicate stuff changed. I also took the samples home. I think I completed about 2 months worth of work in 1 week. Normally, I would have worked on 1-2 products at a time, going back and forth. But since I was there, I worked on over 10 products at the same time. The factory sample maker probably didn't like seeing me.

Now that I'm home, I just came up with a redesign that would make the product better. I wish I was still there, because it is so much easier explaining things in person with the product right in front of you. I could have this redesign in my hand in 24 hours. Now I will have to do it the old fashion way, through skype and email and photos and wait over 1 week to see if they understood me correctly.

 

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