China's Suzhou City Aims to Boost Cross-Border E-commerce Following Success of Shein and Temu
Suzhou plans to double its cross-border e-commerce business annually for the next three years. The city aims to tap into the success of platforms like Shein and Temu. Suzhou will focus on promoting high-value-added industries for overseas expansion.
Suzhou, a thriving hub for hi-tech manufacturing in eastern Jiangsu province, has unveiled an ambitious plan to double its cross-border e-commerce business over the next three years. The city aims to tap into the growing influence of Chinese platforms like Shein and PPD Holdings' Temu. The municipal government has issued a policy document outlining its strategy to accelerate local business digitalization, attract top cross-border e-commerce projects, and build a robust ecosystem for related businesses.
The plan focuses on promoting high-value-added industries such as new energy, automotive electronics and parts, and artificial intelligence (AI) to expand overseas. If Suzhou can achieve its goal of doubling e-commerce exports and imports annually, the city's annual turnover is projected to reach 150 billion yuan (US$20.7 billion) by 2026.
The government aims to have at least 600 traditional foreign trade and manufacturing enterprises engage in cross-border e-commerce each year. By 2026, the number of cross-border online merchants in the city is expected to exceed 15,000. Key policy support will be provided to benchmark enterprises, with a particular focus on the cross-border trading sector.
To facilitate cross-border e-commerce development, Suzhou plans to build infrastructure and establish a robust supply chain, logistics, and payment services. The city also aims to operate overseas warehouses covering 1.5 million square meters, operated by local enterprises. Additionally, Suzhou plans to cultivate at least two cross-border e-commerce industrial parks by 2026.
Suzhou's initiative comes as major cities in China seek new approaches to boost economic growth in the wake of a slow post-pandemic recovery. Cross-border e-commerce has emerged as a bright spot for Chinese firms, driven by the increasing popularity of retailers like Shein and Pinduoduo's Temu. Alibaba Group Holding, the owner of the South China Morning Post, has also been ramping up efforts to tap into overseas consumers.
Shein, a China-founded online fast-fashion brand, has experienced explosive growth in recent years and now accounts for a fifth of global fast-fashion sales. Temu, with its big marketing campaigns during the Super Bowl, has quickly become a rival to Shein and other budget retailers. Last year, Temu bought six slots for television ads during the Super Bowl, spending tens of millions of dollars on the campaign.
According to China customs data, the country's export and import trading volume of cross-border e-commerce reached 2.38 trillion yuan last year, a 15.6% increase compared to the previous year. iResearch, a Chinese think tank, projects that this figure will reach 2.95 trillion yuan by 2024.
While Suzhou aims to catch up with more established cross-border e-commerce hubs, particularly in Guangdong province, the majority of cross-border e-commerce businesses are currently located in the southern province. Suzhou's plan seeks to position the city as a major player in the rapidly growing cross-border e-commerce market.
Suzhou plans to double its cross-border e-commerce business annually for the next three years.
The city aims to tap into the success of platforms like Shein and Temu.
Suzhou will focus on promoting high-value-added industries for overseas expansion.
Source: SCMP