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These 4 Chinese Marketplaces Are Capturing the Attention of Western Sellers
Stay on top of the latest e-commerce and marketplace trends.
Alibaba, one of the largest marketplaces in the world, has recently opened up its AliExpress online retail business to sellers in a select group of countries outside of China. Sellers from Italy, Russia, Spain, and Turkey can now sell products internationally via the AliExpress platform. Amazon and Alibaba were named first and second, respectively, in a recent survey on the most valuable global retail brand and this diversification is a direct move on behalf of the Chinese retailer to step up its head-to-head competition with Amazon.
However, Amazon announced that it is closing its e-commerce marketplace for third-party sellers in China this July. For sellers interested in selling in the Chinese market, there are other options to consider. With China on pace to surpass the U.S. as the largest retail market in the world by year-end and home to Singles Day, the most successful global online shopping event, we have compiled four fast-growing marketplaces in the country for you to be aware of.
1. JD Worldwide
JD, or Jing Dong, is China’s second largest e-commerce marketplace, second only to Tmall Global which we will discuss next. The company, which boasts over 300 million active users, allows sellers and brands to sell product directly to online Chinese shoppers without housing inventory in mainland China. You can sell products and ship individual units directly from your warehouse in the United States, Europe, or Australia.
The company has an extensive fulfillment network, with over 200 warehouses and thousands of pickup and delivery stations. They offer three sales options for international sellers and brands:
- JD Direct Sales, which involves JD sourcing products directly from international suppliers
- JD Marketplaces, which is reserved for brands or suppliers registered within mainland China
- JD Worldwide, the global, cross-border platform for brands registered outside of mainland China
To participate in the direct sales option, you would need to be active on JD Marketplace or Worldwide first. The program is not open anyone, you need approval from the company’s Business Development team once you have submitted the proper documents proving that you own your brands and are authorized to sell them. You need to be able to provide trademark registration documents or licensing agreements and also need a USD bank account and sales history.
If you are approved to move forward, you are required to pay a service fee of $1,000 per month and a refundable security deposit of $15,000. Then, you can begin selling and will pay a commission, similar to Amazon’s referral fee, on each sale — plus a logistic charge if you are relying on JD for fulfillment.
2. Tmall Global
Tmall was first launched in April 2008 as a spinoff of its parent company Taobao and is operated by Alibaba. The company allows both local Chinese and international businesses to sell products to consumers in mainland China, Hong Kong, Macau, and Taiwan. The platform has more than 500 million active monthly users and over 70,000 brands available for purchase across its marketplace.
In 2014, Tmall established Tmall Global to enable international brands to gain traction in the Chinese market by selling high-quality, imported goods. Tmall Global organizes the products by their country of origin, providing an advantage to cross-border sellers to stand out from their domestic competitors. On Tmall Global, you have your own storefront that you have full reign to customize. You can fulfill orders from outside of mainland China, can use a non-Chinese legal entity, and can be paid in USD or EUR directly to your bank account.
Originally, the company was intent on offering products exclusively from Australian brands and sellers — the name means “koala” in Chinese. However, since its launch in 2015, the company has expanded its product selection to include brands from over 80 countries. It offers rapid payments that are completed within seven days, which is highly attractive for sellers. If you are interested in selling on Kaola, requirements are outlined below:
- You need to deposit $10-15K in security, which is refundable.
- You are required to pay a commission fee between 2-10%, varying by product category.
- You must pay a yearly product category fee off $1,000.
Like JD Worldwide, you can choose the sales model that makes the most sense for your business. The first option is supplying Kaola with products directly, which requires you to submit an application and waiting to see if they extend an invitation to you. The second option allows you to open a third-party store-front as long as you have brand authorization and other corporate requirements such as sales history.
4. ttHigo, Powered by Newegg
ttHigo is focused on selling upscale, premium branded products for affluent Chinese consumers. Powered by Newegg, the tech-centric e-commerce site that was founded in 2000, ttHigo charges sellers a 15% commission fee, but omits deposits or registration fees like the other marketplaces outlined in this article. Newegg boasts its Marketplace Global Selling Program to allow you to list your products in over 80 countries. You have the option to get paid every 15 days in USD, directly to the bank account or e-commerce payments provider of your choice.
If you are already selling on Newegg in the U.S. or other marketplaces outside of China, the barrier of entry to ttHigo is much lower and the steps you need to take are as follows:
- Log in to your Newegg Seller Portal and select a preferred shipping method.
- Accept ttHigo’s Terms and Conditions.
- Select which products you are going to sell to Chinese customers.
If you are looking to penetrate the Chinese consumer market, the online marketplace(s) that you choose will greatly depend on your catalog and which items you are planning to sell overseas, as well as the size and revenue of your business. Security deposits are common among Chinese marketplaces in order to prevent the sale of counterfeits, but if you expand to the market once you are already experiencing revenue growth domestically and bring a product set that will appeal to the target demographic, you will yield strong results.