RESEARCH METHODOLOGY JURY

BRI: UTILIZING CROSS-

BORDER E-COMMERCE IN
CHINA WITH A FOCUS ON
THE CHINESE FASHION
INDUSTRY

DONE BY
ANEESHA PANDA
MANOGNYA MISHRA
INTRODUCTION

 The Chinese fashion market is one of the largest fashion

markets in the entire world.

 The Belt and Road Initiative (BRI) is one of the world’s

largest projects with regards to international trade. Many
countries take part in it and the main country supporting
and developing the BRI is China.
OBJECTIVE

 Concepts of BRI and cross-border e-commerce

 Collect and analyze all the data of fashion industry which is

one of the largest industries affected with regards to the BRI
and cross-border e-commerce.
 What is Belt and Road Initiative?

 China’s Belt and Road Initiative (BRI) is a strategy initiated by

the People’s Republic of China that aims to connect Asia
with Africa and Europe through Land and maritime
networks.

 The aim of this project is to improve regional integration,

increasing trade and stimulating economic growth.
In China, CBEC holds a specific distinction where international
companies can sell their products to Chinese customers at
preferential duty rates and without a license to operate a
business in the country.

Most of these cross-border trades are performed by companies

from other Asian countries which are led by Japan and Korea,
followed by the U.S.

Cross border e-commerce is huge in China. There are some

major companies active in this sector that are known all around
the world such as: Tmall global which is currently China’s
biggest cross border e-commerce platform owned by the
Alibaba group
 Role of BRI in Cross border e-commerce in China

 The BRI plays an increasingly important role for Cross-border

e-commerce in China. The e-commerce sector is booming in
countries along the BRI.

 Russian buyers for example, could receive their goods within

5 days in 2019 which used to be 50 days in 2016.

 This demonstrates the massive influence the BRI has on

cross-border ecommerce in China. These massive decreases
in time make it a lot more attractive for Chinese as well as
foreign citizens to buy products from foreign markets.
The problems caused by the development of cross-border e-
commerce companies due to the BRI

 The first one being, imperfect laws and regulations and difficult
mutual certification. As cross border e-commerce includes more
than one country, these companies will face different local laws and
regulations. Countries that take part in the BRI vary greatly when it
comes to different customs and cultures.

 The second issue are the regional differences in economic

development in China’s e-commerce.

 A third possible issue could be overseas warehousing. As cross-

border e-commerce is becoming bigger and bigger and the BRI
stimulating companies moving to other countries, overseas
warehousing will play an increasing role.

 Lastly, low efficiency and high cost of logistics and poor international
service
 Solutions to such problems

 Generally, Cross-border e-commerce can make use of the

existing e-commerce platform or the internationally
accepted legal system as a reference for the trade.

 With regards to the problem of regional development

differences in e-commerce in China, it needs to be dealt
with through comprehensive strategy due to the limitation
of policies and resources.

 To help the overseas warehouses problem, foreign

enterprises could be building an overseas warehouse
alliance
 The Fashion industry in China and BRI

The Fashion industry in China is one of the biggest industries in

the country. The Fashion industry has also been on the rise in
the recent years. For instance, Chinese per capita spending on
clothing and shoes has grown over three times over the last
two decades.
Points to consider before exporting to the Chinese Fashion market

 The first point is that the brand should realize what products
they sell

 Secondly realize what area in China you want to infiltrate.

 Thirdly, there can be major differences in culture, regulations,

and sometimes laws.

 Lastly, realize that the Chinese Fashion market is the second

biggest in the world and one of the largest growing markets
making this a very attractive opportunity for foreign fashion
companies.
Common mistakes made by companies entering the Chinese market

 The first mistake is not following China’s politically correct standard

 The next mistake are brand naming issues

 Overpriced products or targeting the wrong consumer group is the

next mistake.

 The last mistake is a rather strange one and one that many companies
not think about which is choosing the wrong packaging size
 Does the Fashion industry truly need the BRI for Cross-
border e-commerce success?

 A counterargument could be that indeed the fashion

industry was already functioning well in China through e-
commerce before the implementation of the BRI and that
there is a link between technological development, and the
boost in e-commerce.

 Next to this BRI significantly lowers down waiting times

between order and delivery making it much more attractive
for Chinese Citizens to order their clothes from foreign
countries that also take part in the BRI.

 This purely due to the BRI making Cross-border e-commerce

a lot faster and easier, therefore boosting online shopping
from foreign websites.
 Research Gaps and Analysis

Gap-1
Current state: As we speak not many Foreign Fashion
companies have made the decision to enter the Chinese
Fashion market even though it is one of the largest fashion
markets in the world. This is mainly due to Local Chinese
companies dominating this market and in most cases these
companies also export to foreign countries due to low price
clothing.
Desired state: The desired state is to have a more foreign
influence on the Chinese fashion market. As we speak the
Chinese Fashion market is mainly dominated by local Chinese
companies. In a desired state there are more active foreign
fashion companies in this market.
How to bridge the GAP: Create a website based around the
Chinese language and culture, get help from a local fashion
businessman with knowledge about culture and regulations,
stand out as a brand and give the customers therefore a reason
to buy your product.
Gap-2
Current state: In terms of entering China, it is much easier,
cheaper, and faster to enter cities that are located next to the
sea as these cities have a good logistical connection to the rest
of the world and most of these harbours are among the largest
in the world. To get to more inland located cities a more
sophisticated and difficult logistical infrastructure is required.
Desired state: It is easy to export to any city in China no matter
where they are located. Foreign fashion companies will not
have an increasingly difficult supply chain when exporting to
these inland cities through CBEC.
How to bridge the GAP: Maximize the use of the BRI to get a
slight advantage in trading with inland cities, primarily enter
cities with a good logistical connection to the rest of the world
then see whether warehousing in these cities would help the
process of also exporting to inland cities, Use the knowledge of
experts to get a good advice.
Gap-3
Current state: The Chinese consumers has developed a
different taste of fashion over the years. They used to buy the
foreign brands just for the brand itself and not for the quality
nor the designs. However over the years this has changed
dramatically to Chinese Consumers only buying clothes due to
the quality and the design forming a large challenge for foreign
and domestics fashion brands.
Desired state: The desired state is for the Chinese consumer to
find a balance between preference of brand and preference of
quality and design. In this way foreign brands can utilize the
market by making use of their brand image while also creating
high quality clothing with unique designs.
How to bridge the GAP: Already have a foreign known and
respected brand before entering the Chinese market, create
unique design and take big responsibility in quality and quality
control, use the knowledge you get from consumer insights to
develop an even better design. These insights can be seen and
analysed when looking through different analytical tools such
as google analytics.
 Conclusion

 The Chinese market is a very interesting market to be

entered for foreign fashion companies to say the least and
with the development of the BRI this market has only
become more interesting for foreign fashion companies.

 Not only will the BRI ease the transportation process and
lower the costs of exporting to China, but it will also open
possible opportunities to export to other countries that take
part in the BRI in a later stage for a foreign fashion company.

 So, in conclusion, if a foreign fashion company that uses

CBEC wants to launch in the Chinese market and export to
China, the best way of transporting is through using the
advantages of the BRI as this ultimately makes exporting to
the Chinese market easier but also a lot more attractive.
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THANK YOU