Looking Back On The "Big Profits" And "Huge Losses" Of Cross-Border Sea Going In 2021

In 2021, the coexistence of "black swan" and "grey rhinoceros" will bring more absurd and bizarre stories to the cross-border e-commerce export industry, which is full of stories of wild growth and sudden wealth overnight.

"A small team of two or three people sells US $10 million a year", "reselling fascia guns to earn two sets of Shenzhen Bay mansions in a year", "19-year-old student sister made a net profit of 3 million yuan in foreign direct broadcast"... The success of the first entrants was spread by word of mouth, which made countless latecomers feel the blood spurt. "It's hard to move in China. Let's go abroad." As a result, the cross-border e-commerce export has set off a small upsurge in the past year or two.

However, in April 2021, the massive Amazon closure event broke out, which pushed the pause button for this high song. Over the next 200 days, store closures, layoffs, bankruptcies, going public in doubt, suing for debts, selling off assets and other things that exceeded our expectations were staged in turn, and the voices of questioning, panic and finding a new way out were also spreading. Coupled with the epidemic situation and the uncertainty of international trade policy, magic events come out one after another.

The Fifth National Congress of the Communist Party of China promoted "0" to issue orders, "one cabinet gives another cabinet a brush, and another uses it as a second kill". After nine years of losses, the shipping company has made all the profits in this year At the same time, some long-standing contradictions have gradually emerged. In addition to the direct trigger of Amazon's title, there are also fierce competition among peers, "black technology" circumvents platform regulation, illegal station group sellers force the website platform to be closed, and multiple cross-border platforms successively "thunder"

To use a hot word of 2021 to describe the cross-border road that you have gone through: "it's ridiculous!"

But fortunately, after seeing all the events in the industry, we can see the development of new things. China's cross-border e-commerce business has just entered a new era of public concern, and has not entered a glorious era of rapid progress. Therefore, more patience and methods should be given to the latecomers. Perhaps avoiding the "thunder" in 2021, cross-border people can walk more calmly and steadily in 2022.

　　01、 Many years of communication failed,

Amazon blocked more than 3000 Chinese accounts

"Amazon's brand name boom" began to ferment at the end of April 2021 and lasted for several months, which was definitely the top event in the industry in the past year. Although Amazon has been punishing non-compliance operations for many years, especially before and after the annual promotion Festival, this "big ban" is unprecedented in terms of "scale and volume" and "punishment intensity".

Perhaps it is due to the pressure of public opinion (from the Wall Street Journal, Time magazine and other authoritative US media's verbal criticism of Amazon sellers' behavior of asking for comments and brushing orders), or the platform ecological environment has reached a stage in which it is in urgent need of "blood exchange", and a "clean-up" campaign begins.

According to the official data disclosed by Amazon, as of September 17, 2021, Amazon has blocked more than 600 Chinese brand associated with more than 3000 accounts. Companies that have been banned will stop work, lay off workers, suspend IPO, lose half of their lives, or even go bankrupt directly. In this regard, Amazon official to the outside world reluctantly said: "this is the result of many years of communication with the seller failed."

To a certain extent, the operation is also a kind of "bone scraping and healing poison" of Amazon, which can remove the "poison" and also hurt itself. For example, after being punished or feeling Amazon's iron face, many sellers turn to other new e-commerce channels.

As for Amazon, since the new era has come, it will surely speed up efforts to get more big brands to settle in. "In the future, Amazon wants brand sellers to settle in, and will give some support in policy, such as Amazon inventor, transparent plan, brand accelerator, traffic priority import, etc. brand sellers will bring more commission and put in more advertisements on Amazon platform, and advertising is a piece of revenue that the platform attaches great importance to." One cross-border service provider said.

　 　02、 From "profiteering" to "huge loss",

Cross border sellers laugh at "Wu San counter"

"A cabinet to send, a cabinet brush, a cabinet to do second kill", referred to as "Wu three cabinets.". This is a self mockery widely circulated in the circle of cross-border e-commerce sellers in 2021, but it also tells us the thorns and competitive pressure in today's environment.

A straightforward explanation means that some of the goods in the seller's hands are used as gifts, some are used to brush bills, and some are used to do seckill activities.

Since 2020, the strong "cash ability" of cross-border e-commerce has spread throughout the domestic e-commerce circle. Many businesses regard cross-border e-commerce as the flow dividend of the new era, and a large number of them follow suit to enter this track. However, the ranking of e-commerce platform listing is limited. In order to seize the market share, these new players started crazy low-cost routes. For example, paying expensive freight, over delivery, sending products to buyers to get comments, frequent operation of "1 yuan second kill" and other rush buying activities.

This "suicide" price reduction method forced other colleagues to join the war. After all, in the absence of obvious brand barriers and product advantages, the choice of consumers is simple and crude: who is cheap to go to whom.

Combined with the impact of the epidemic, the mainstream platforms represented by Amazon have tightened the storage capacity of warehouses. "The storage capacity of more than 50000 instantly drops to more than 20000. If the goods are detained in the warehouse, they will be charged high storage fees." Some sellers explained to Yibang power that in order to recover the funds, the sellers had no choice but to clear up the accumulated inventory by losing money and running volume.

Under the multiple pressures of industry internal volume, logistics cycle slowdown and warehouse explosion, the "industry price war" has started completely. The business of cross-border e-commerce export has changed from "profiteering" to "huge loss" overnight.

　　03、 Peak season is not prosperous, black five big promotion also "dumb fire"

What makes people feel sad is that even if they are ready for low price promotion, the reality is often more ruthless than imagined.

Normally speaking, September is the busiest season for cross-border e-commerce, such as Halloween, Thanksgiving, Black Friday, Christmas and other consumer holidays in Europe and the United States, which focus on October to December. It can be said that for cross-border sellers mainly engaged in the European and American markets, the key to their annual income lies in these three or four months, which is no less important than the "double 11 Carnival" in China.

But the dramatic scene happened during this year's rush season. Most of the sellers have responded that this year's "black five net one" has plummeted compared with previous years. Some sellers can sell "3000 orders" through a single link in one night, while some sellers don't receive any grains, staring at the background "0" to issue orders until the next morning.

These businesses with poor performance can't help but send articles in the circle of friends to ridicule:

"Has black five started yet? Did I remember the wrong date?"

"Burst a single! Yesterday, a fierce 6 orders! Compared with the day before yesterday's 1 single, 7 times growth!"

"F5 all press rotten! Haven't seen the order yet!"

"The operation is as fierce as a tiger! When you look at it, there are only 5!"

　　……

Although the annual black five promotion, from the business side of the single volume feedback, there are always some people happy and others worried. But in 2021, a large number of cross-border sellers do feel more "magical" than in previous years. On the one hand, inflation in some countries, shortage of raw materials and soaring logistics costs have deepened the uncertainty of the industry; On the other hand, in the whole cross-border e-commerce chain, under the long cycle from production to sales, I don't know what changes will happen in which link.

"If you don't prepare the goods before the big promotion, you will lose more if you prepare the goods." Some cross-border sellers said.

Just as in 2021, the domestic double 11 has entered the "dumb fire" stage, and the mentality of cross-border sellers towards the promotion in peak season is more "Buddhist".

　　04、 After nine years of loss, the shipping company made a profit in this year

Shipping companies are probably the happiest people in the year.

In 2021, the shipping market will usher in the strongest profit cycle. The rising freight charges will make the global shipping giants full of money, and some shipping companies will make the money they haven't made in the past decade in a year.  

Take evergreen shipping in Taiwan as an example. According to local media, EVA marine lavishly handed out the year-end bonus of 40 months at the end of 2021. Various kinds of ridicule about the shipping companies have come and gone: "I can't see so much money in my life", "I'll find EVA shipping if I choose a mate", "Wuling Hongguang in the first half of the year, Bentley and Rolls Royce in the second half of the year".

All this has to start with the epidemic. In a special period, many industries can not afford to fall, but the shipping industry is an exception. Due to the impact of the epidemic, the global supply chain has broken, so the demand for containers and freight in the market has soared, resulting in a sharp rise in the average freight of the shipping industry. Coupled with the delays in ports and terminals, major container and shipping companies continue to charge fees even during the waiting period.

According to the data of international shipping research and consulting agency de Luri, the profit of container shipping industry is expected to reach 150 billion US dollars (about 956.4 billion yuan) in 2021, while the overall profit of this industry will be only 25.4 billion US dollars in 2020.

Yibang power understands that in the past 20 or 30 years, the supply of marine trunk lines has always been a market of Party A with oversupply, and many small-scale shipping companies have been in the loss making stage, but the situation has been reversed since October 2020. "Because of the epidemic situation, many cases can't come back, coupled with the shortage of transport capacity and manpower, the price rise is certain." Some cross-border logistics service providers pointed out to Yibang power that what's more, they directly transferred the "contracted price" given by the shipping companies to the market, resulting in the final doubling of the already high freight rates.

In 2021, with so many variables, it seems that shipping companies are the few winners in the mess.

　　05

High tuition fee!

More than 15000 Chinese sellers' trademarks have been cancelled

At the end of 2021, the cross-border circle has again exploded. This time, it was the intellectual property agency that won the bid.

According to Yibang power, in December last year, 15801 US trademarks held by an intellectual property agency in Shenzhen were forcibly revoked by the US trademark and patent office, involving 179 pages of invalid trademarks.

USPTO pointed out in its ruling notice to the company that the latter had a series of non-compliance behaviors, including illegal agency, signing application on behalf, sharing application account, etc. At the same time, the U.S. patent and Trademark Office also believes that the agency is suspected of fabricating lawyer qualifications, embezzling lawyer information, and providing fictitious or fraudulent information for trademark application.

This may be the biggest penalty that domestic intellectual property companies have received so far in their agency related business in the United States. And this case has also been listed as a precedent of the same type of cases by the US trademark and patent office.

There is no doubt that cross-border sellers are the ones who are most hurt by such incidents. The loss of registration fees is still the second. What's more, many of the old trademarks have been used for more than 10 years, but all of them are invalid overnight.

Will invalid trademarks lead to "abnormal brand filing" in the future? And will it become the handle of non-conforming sellers blocking platform in the future? Anger and panic in the seller circle is spreading.

Yibang power learned that many sellers did not have enough research on intellectual property rights at the initial stage and thought that trademark was only a simple agent, so they blindly sought low prices, which gave some bad companies the opportunity to fish in troubled waters. In the process of wild growth of cross-border e-commerce, this is another high tuition fee.

　　06、 Station group sellers are too rampant!

"Forcing" independent station construction platform shut down

"A new site building tool every week!" A cross-border seller described the current hot independent station industry.

In 2021, cross-border sellers have a deeper understanding of the "independent station" as a sea going channel, and the market is gradually cultivated. According to incomplete statistics of Yibang power, there were more than 10 SaaS service providers active in building independent stations last year, such as international giants Shopify and big commerce; Another example is that domestic service providers have increased their overseas business, such as allvalue and wechat shopexpress; As well as shopkeepers shoplazza, shopline, ueshop, shoppy, meshop, funpinpin, shopplus, who were originally born in the cross-border e-commerce industry.

However, with the rapid development of cross-border e-commerce independent stations, some people are throwing gold into the track, while others are retreating in a rush. In April 2021, shoptago, which has just been established for 500 days, has suddenly and permanently closed down, which has caused a lot of uproar in the industry.

Shoptago pointed out in the announcement that "although the platform continues to carry out risk control measures, it still fails to effectively curb the influx of non-conforming station group sellers, and the proportion continues to grow." reviewing the original intention of the establishment is to serve the brand of cross-border e-commerce sellers in the industry. A notice, showing regret at the same time, but also pointed to a continuous stream of non-compliance station group players.

The mode of independent station group with fast start-up, low cost and high profit once attracted a large number of cross-border e-commerce sellers. It refers to that sellers can quickly build batch websites through website building tools. Each website only sells a small number of products, and each product is tested with rated budget Facebook ads or Google GMC. Once it is judged that the product has the opportunity to become an explosive product, then increase the budget investment. Usually a day can be measured dozens of products, the basic week can run out of an explosive product. If the data performance is not good in two or three weeks, close the store directly, change the account number, and then test again. It's like gambling, the chance in custody.

The problem is that in this mode, the seller's main focus is on how to sell the goods, often ignoring the product quality and user experience. In addition, some "black hearted sellers" are mixed up. These sellers will not consider whether the source of goods, the cost is reasonable or not, and how the profit margin is. They directly copy the good product pictures on the market to their own websites, and then put in Facebook ads, and lower the price of products as much as possible, just to drain them to their own websites, Therefore, there are a lot of illegal operations such as "no delivery after receiving the money" and "the goods are not on the board".

Shoptago believes that this is a short-term benefit, and he does not want to serve the false bubble of the industry, so he chose to shut down to draw a line with these non-conforming station group sellers.

From the perspective of independent station ecology, the non-compliance behavior of station groups will disrupt the development order of the whole cross-border market and the legitimate competitive environment, and also reduce the group impression of overseas partners on Chinese sellers; From the seller's point of view, if the station group seller's advertising investment is too fierce, it will also increase the flow cost of the whole industry and reduce the net profit. How far can sellers, who are still advocating barbarism, go when the platform decides to break its arms to seek long-term doctrine?

　　07、 Several cross-border e-commerce platforms have collapsed one after another

In 2021, there are also some cross-border e-commerce platforms that were once popular for a time.

Zhiyu was originally an absolute Unicorn enterprise of cross-border e-commerce in the Middle East. The founding team was very forward-looking. When sheen invested heavily in North America, she took advantage of its advantages, laid out its layout in the Middle East, and quickly established its own comparative advantage. However, in 2021, it is deeply trapped in a series of difficulties, such as supplier arrears, layoffs, legal disputes, and the departure of the founding team. At the beginning of 2022, the website, app, seller center and other landing pages of jolly chic, a shopping platform under Zhiyu, could not be opened and were suspected to have been closed. The update date of the brand's official accounts on several social media was also stopped on July 31, 2021.

Ajmall, another cross-border e-commerce platform in the Middle East, is also out of business at the end of 2021, notifying sellers that it will be shut down due to business adjustment of the platform. The platform was officially launched on August 20, 2018, and has successively obtained more than $50 million of investment from xvc, Zhenge fund, source code capital, Yilian capital and huanju times. In 2019, ajmall remained in the top three in the Saudi app store shopping app download list for a month in a row. But ajmall's official Facebook account was last updated on October 29, 2021.

Vova, once boasted itself as "international version pinduoduo" in relevant investment promotion, received the support of many sellers. However, in September 2021, the platform shut down a large number of shops without warning, and the investment promotion managers also "collectively left", leaving a crowd of people who did not know the truth were dumbfounded. Then, vova's PC website could not be accessed, and login to the business center was prompted that the website "has security risks". What's more absurd is that in the group of businessmen who are engaged in group discussion, they summarize the information of the injured businesses in the form of forms, but in the end, the accountability and debt collection are not successful, but the forms fall into the hands of investment promotion managers of other platforms, trying to call one by one to attract business

Platform shutdown is often the result of many factors intertwined. In addition to its own business problems, it may also be due to high competition pressure, single mode, too heavy upstream and downstream chain, eager to tell stories to capital, and unpredictable epidemic situation, etc., so it is difficult to draw a conclusion with any of the reasons. However, it is undeniable that the most obvious factors, such as the sequelae of savage growth and the fracture of capital chain, seem to accelerate the end of life of these platforms.

And then another thought is: is the ultimate destiny of platform mode only first or death?

At present, in addition to "internal worries", the "foreign invasion" faced by the vertical platform or the middle waist platform is a double-sided attack. On the one hand, Amazon, as a global e-commerce platform, has been developing steadily and has become a dominant company. No one can bypass it in doing cross-border e-commerce; On the other hand, the decentralized independent station force promoted by Shopify has sprung up all over the world. If it is an independent brand, we should pay attention to him. "Big", with Amazon; "Small", with independent station. How can other platforms win the world?