Crazy baby money earned by the surging force of China e-commerce startups in foreign markets

Sometimes big money can be earned quietly, and it would require you think differently.

B2C e-commerce startup might be a dead idea inside China, considering the duopoly from Alibaba and JD, but some are wise enough to cast their eyes over the opportunity overseas, especially in baby&maternity sector. One target is the middle east, a region in which

-each man is allowed to have 4 wives and a ban on abortion resulted in the highest rate of population growth in the world

-22% of the population demographics are under 10 years old

-women are often restricted to walk out of the home alone for offline activities in some most religious countries

-high levels of disposable income (GDP per capita is 10 times greater than China) and high internet and mobile penetration rate

All these factors make perfect sense to grab some online baby money there. One Chinese startup Jollychic has set up an extremely successful case.

Founded in 2012 in Hangzhou, it is now one of the most downloaded shopping apps in the middle east, with 30 million registered users generating at least USD 300 million sales last year. The fact that in May a series C funding from Sequoia catapulted the startup into the unicorn valuation of USD1 billion further validated its solid business model, even though Jollychic still faces fierce competition from the local rivals.

China startup e-commerce startups are also vying for the US and European markets. In April, coincidentally, Sequoia led another USD48 million series C funding for a B2C cross-border platform focusing on maternal and infant products, PatPat. The startup was established in 2014, selling to western mothers who have the annual incomes between USD 30,000 and 90,000.

 

The founder claimed that

-the platform is able to launch 200-800 SKUs every day backed by over 800 vendors behind

-it is covering more than 100 countries in the west

-the scale of its user base already reached 20 million

-average sales per transaction are around USD 74

-repurchase rate 37.4%

-delivery time is usually around 4-10 days

China is already the world leader in retail technology and innovation, in particular in e-commerce. The above examples clearly suggest that by exporting its best practices and sophisticated skills in e-commerce personalization, marketing, supply chain, logistics, Chinese entrepreneurs have very strong capability to carve out a niche in the foreign markets.

Author: Cecilia Wu