news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

At a time when the domestic fertility rate and willingness continue to decline,

Southeast Asia's attractive fertility base,

Attracting players to join.

Maternal and infant cross-border e-commerce,

Smelled the dividends of this emerging market.

On the other hand, Southeast Asian e-commerce platforms are expanding rapidly.

Citizens' consumption capacity and enthusiasm are also increasing.

For example, in the Philippines,

In 2023, the budget for purchasing maternal and infant products will account for 20% of income.

It is predicted that by 2027,

Indonesia's maternal and infant market will reach US$3.8 billion.

Vietnam will reach $7 billion.

The development of e-commerce in Southeast Asia is greatly influenced by the domestic situation.

There is a similar development trend.

But the new soil has different concepts, rules and habits.

To survive in the gap between international first-line and local brands,

We also have to face competition from more and more entrants.

Yitiao found many young people engaged in cross-border maternal and infant e-commerce.

I want to hear how they are making money in Southeast Asia.

Editor: Hong Bingchan

Editor: Ni Chujiao

Electric breast pumps are selling like hot cakes in Vietnam. Jenny, who has run a maternity and baby store in Vietnam for ten years, has changed her supplier in recent years and has placed orders for breast pumps from a factory in Ningbo, China. The factory has a wide range of products, fast updates, and complete accessories. Including the cost of sea transportation, the price is cheaper than local brands. Open the e-commerce platform in Southeast Asia and search for keywords such as baby clothes, milk bottles, toys, and diapers. There are many products with sales exceeding 10k, and there are many popular products with sales of hundreds of thousands of pieces. On domestic wholesale platforms, search for maternity and baby cross-border products, and the champion products of multiple manufacturers that pop up can have monthly sales of more than 10,000 pieces.

We contacted several factories that make baby bottles and other breastfeeding products, located in Fujian, Dongguan, Yiwu and other places. Some of them previously engaged in other foreign trade businesses, but smelled business opportunities in recent years and adjusted their production lines to transform into maternal and child products. Some have been in this field for nearly ten years. Without exception, they all said that most of their orders come from the Southeast Asian market.

Gina sells toys in malls and flea markets in Singapore

This business is not just a game for big brands to expand, small players also have a place. White-collar workers working in China use their free time to open online stores and earn more than their wages, so they quit their jobs. Such stories are common in cross-border maternal and infant e-commerce. The technical threshold for opening and operating online stores is not high, and it is considered to be the first choice for small teams or even one person to do a side job. It has attracted many full-time housewives who are consumers themselves and can start a business at home.

Lucia, who runs a baby clothing business in Malaysia, said that at first she sold white-label products (unbranded products produced by small and medium-sized manufacturers, products with low recognition), focusing on small profits and quick turnover. As the number of orders increased, she gradually transformed into her own brand, with manufacturers producing under their own brand and customizing them. Originally, all sales channels relied on online stores, which had to pay high platform fees. Later, she built her own independent website and gradually transformed into a brand.

Sherky's diaper warehouse in the Philippines

The number of Internet users in Southeast Asia has exceeded 400 million, and the e-commerce market has maintained rapid growth in recent years. In 2023, the scale is expected to exceed US$200 billion, doubling from US$100 billion in 2020. Maternal and infant products are one of the important categories. They account for 5%-10% of the overall sales of cross-border e-commerce in Southeast Asia. In 2022, the annual growth rate of maternal and infant cross-border e-commerce sales will reach 20%-30%.

According to Statista's 2020 survey on the number of births per woman in Southeast Asia, the Philippines has 2.49 children, Vietnam has 2.05, and Malaysia has 1.97. Despite the decline in overall fertility rates, Southeast Asia, as the region with the largest number of newborns in Asia, still has strong demand for maternal and child products.

Data from the "Study on Chinese Maternal and Infant Brands Going Abroad" shows that by 2027, the global maternal and infant market will be close to US$1.4 trillion, growing at a compound annual growth rate of more than 5%. Despite the uncertainty in the global economy, more than 70% of respondents said they would increase or maintain the same level of spending on baby products and services.

Southeast Asia is a multi-ethnic and multi-religious environment, so businesses also need to understand the consumption habits and cultural taboos of different groups of people. For example, toys for Muslim children should avoid pig images; nursing clothes for mothers need to have appropriate covering functions to facilitate breastfeeding in public. The timing of promotions is also important. According to local festivals, for example, you need to pay attention to the gift-giving needs of different groups during the Chinese New Year, Hari Raya Haji, and Christmas. It is also necessary to follow the local salary payment habits. For example, many companies in the Philippines pay salaries every half a month, so businesses offer discounts every half a month.

Businesses are embracing opportunities while also overcoming challenges arising from the local environment.

The following are the self-narrations of two post-90s who are doing cross-border maternal and child care in different countries.

Just started a business

Gina: 31 years old, selling children's toys in Singapore

I went to study in Singapore when I was 15 years old, so I am familiar with the multi-ethnic environment there. I often find that toys are sold at very high prices in shopping malls in Singapore. Judging from the price alone, they are 70% higher than in China. Grandparents in Chinese families like to buy toys for their children, and they have high requirements for the quality of materials. Malays generally have many children and are not used to saving money. They may spend all their wages by the end of the month, so they are willing to spend money on their children.

In 2021, I worked in the Singapore branch of a Chinese electrical appliance brand. During the period of working from home, I started thinking about doing a side job, so my friend and I opened an online store on a local e-commerce platform.

If I import from domestic factories, I have a price advantage. On the other hand, although the birth rate is relatively low, the Singapore government encourages having children, so I don't think the purchasing population will drop sharply.

Warehouse in Singapore

At that time, Shopee was expanding in Southeast Asia. I first took a course on online store operations, learned some skills in uploading products and managing the backend, and then I was ready to get started.

At first, I didn’t know where to buy, so I went to 1688 to contact manufacturers and buy the products they already had. Later, when the purchase volume was larger, I could communicate with the manufacturers for customization, and I occasionally went to Yiwu to buy directly.

Special attention should be paid to religious taboos and aesthetic habits. For example, Malays try not to have pigs and dogs, while Indians like rich and bright colors.

As for shipping logistics, many people in Singapore used Taobao before, so there are many options locally. Warehousing must be solved, so I bought a warehouse in Singapore, paid the down payment, and had to pay a loan of about 10,000 RMB every month. My average customer price is 10 SGD. Because of transportation, warehouse, local manpower, and platform commission, I can just break even.

The toy market has off-season and peak season. Children's Day is in October, and they like to buy gifts at Christmas, so the second half of the year to the Lunar New Year is a sales peak, and the first half of the year is an off-season, and they may be in a loss-making state for several months.

Last year, I quit my job on impulse. I thought I would not regret it. There are not many opportunities to start a business at the right time in a lifetime. My long-term goal is to open a store offline. It is different from China. The real economy here is still very hot. There are many people in the mall, and it is very prosperous. In addition, it is easy to make impulse purchases offline. It is not as price-sensitive as online, and the average customer spending is relatively high.

My current income is higher than before I quit my job, and I have more free time

I rented a small stall in a shopping mall and sold some high-quality and high-priced products. I made a profit of more than 1,000 Singapore dollars a week, which just covered the rent. I also set up a stall at the flea market organized by the government to clear out the goods. In the offline process, I know which products sell well, which helps me choose products later.

The challenge is still great. Competition in Southeast Asian e-commerce is very fierce. The platform fees of websites are very high. In addition, many people have entered the market in the past two years. The price war is very fierce. I have seen many maternal and child products with very low prices. I estimated the profits and found that the sellers were losing money. They were just used to attract customers. I was the first to sell some products in Singapore. After they became popular, others followed suit and began to import from China. Both sides engaged in a price war, reducing the price by a few cents. The profit margin was shrinking, so I gave up and updated the product selection.

Domestic social media has been rising very quickly in Southeast Asia, so what I’m going to do next is social media marketing, which is actually almost the same as the domestic approach.

sherky: 28 years old, selling diapers in the Philippines

Local people in the Philippines get their salary every half a month. They have no habit of saving money and spend it as soon as they get it.

I have a friend who makes pet diapers in the Philippines. I was not optimistic about it at first, and he lost money in the first two and a half years. Unexpectedly, he suddenly had a huge sales volume at the beginning of last year. At that time, the government issued a new policy that pets must wear pet diapers when going out on the street. I thought there might be opportunities in this market.

The production lines and raw materials for baby and pet diapers are the same. Fujian has a whole industrial chain, so I can quickly find the source factory and lock in the cost advantage. It is not far from the Philippines, so the logistics time and cost are not high. Third, due to religious reasons, the abortion rate in the Philippines is very low, and there are more children.

Last August, I started a baby diaper business in the Philippines. I live in my hometown of Quanzhou, and the sales model is 100% online and overseas warehouses. The production and operation are here, and the warehousing is in Manila.

The overall online shopping momentum in the Philippines is very strong. With the electrical appliances and beauty products already very popular, there seems to be business opportunities in maternal and child products.

Diapers are consumables, so I follow the strategy of small profits but quick turnover. Compared with China, the consumption level in the Philippines is a little lower, and the gap between the rich and the poor is also relatively large. There are big international brands selling locally, but not everyone can afford them. In the low-end and mid-range markets, local Philippine brands are not as competitive in price as I am.

So my diapers are divided into branded and white packages. The latter has a unit price of 20 or 30 yuan for a package of 50 diapers. In China, the price of international brands is close to 200 yuan. Most consumers will not buy white packages because their quality is a little bit lower, but Filipinos are more willing to accept their prices, so they sell well and my profit margin is about 30%.

Warehouse in Manila

The most critical and difficult step in the entire chain is to build your own warehouse. There are many overseas Chinese from Fujian who go to the Philippines. I asked local relatives to help manage a warehouse of 5,000 to 6,000 square meters. It is difficult to find trustworthy local people. If you are not there, you may end up emptying the warehouse as soon as you put the goods in.

We ship full containers by sea, with one container holding about 2 million pieces, and we ship 8 or 9 containers a month. Because diapers take up a lot of space, we currently have about 2,000 orders per day, so the storage pressure is not that great.

This means that there will be three batches of goods at the same time: one batch has been delivered to the warehouse, one batch is on the way, and one batch is being manufactured. In terms of operations, you have to pay attention to their holidays, because all customs officers will be on holiday, and you have to estimate the time it takes for the goods to arrive at the port, otherwise the goods will be stranded for half a month.

Sherky's son's toys, she is also a mother

The promotion time of Southeast Asian e-commerce is actually learned from domestic e-commerce platforms. The major events include 618, Double Eleven, Double Twelve, Christmas and Black Friday. Usually there is a promotion every two weeks.

We will slightly reduce the price on the 15th and 30th of each month, around the time of payroll, and they will buy like crazy. There are risks involved. The online payment process is different from that in China. Our mainstream is to pay first, and the money will reach the seller after the goods are confirmed. In the Philippines, it is basically cash on delivery. After the buyer signs for the goods, he pays the postal company, and the platform transfers the money to the seller. But they are likely to buy a lot during the payroll days, and when the goods arrive, the money has been spent, so they can't pay, and the package is directly rejected and returned. There are many rejections, and the return rate is about 8%.

I have never lost money since I started my business, and my revenue is relatively stable, but I have now entered a bottleneck period, and the number of orders cannot be increased. I want to create my own brand so that I can develop in the long run. Back to the beginning, if the overseas Chinese from Fujian had not gone to the Philippines to start a business long ago, or if the production line had not been built, I am afraid I would not be able to move forward.