B2B e-commerce competes with traditional wholesale markets
7 Jul , 2017
Guolele: "our team of IT professionals gives us a competitive advantage"
B2B e-commerce competes with traditional wholesale marketsGuolele is a fast growing online fruit retailer and e-commerce business in China. The company was founded by Mr Gongwei Chen in August 2014. Mr Xingqu Liang, the import manager, shares his views on the Chinese fresh produce e-commerce market.
The Shanghai sales team of Guolele with, from left to right, Lin Siqing, Wang Xiaojing, Xingqu Liang and Wang Xianyun
“Our key products are citrus, pomelo, apple, pear and mango, which combined make up 60% of our total product offering. 70% to 80% of the fruits we sell come from domestic producers. The remaining we import. As such we can supply our clients throughout the year,” say Xingqui Liang. “In addition, we import a number of exotic fruits. We buy longan from Thailand, cherries from Chile, pitaya from Vietnam, bananas from the Philippines, avocado's from Peru and kiwi's from New Zealand”.
Guolele purchases seasonal fruit that is sold in large quantities, such as citrus, from wholesalers in the regions where the fruit is produced. In other regions, such as Shandong, a team of buyers buys directly from growers. In addition, the company works with a number of local buyers that visit growers in other parts of China.
“We sell our products online in Beijing, Shanghai, Guangdong, Hangzhou, Tianjin and Shenzhen. We work with two online sale platforms to cater for our different clients. Our first website is a B2B platform that caters for fruit shops, retailers and other fresh produce businesses. Our B2B clients can place their orders online and we deliver the products to them. The second platform is called Di Jiu Xian. It is an online shop for end consumers. Price-wise we compete with wholesale prices. Our products are sold below the market price. One of our strategies is to keep our prices as stable as possible.”
Promotion and online sales
“E-commerce has really taken off in China in the past years. Particularly in the big cities there has been a boom since Spring 2015. Big cities have advanced transport facilities, which gives them an advantage. We face two main problems on the e-commerce market. The first is that logistics and transport costs are high. Secondly, because we are a buyer and not a producer, we face quality control issues. We try to tackle this by sending our buyers to the growers to keep an eye on the production and selection process. I expect the e-commerce market to further grow in the future, at the the expense of traditional wholesale markets.”
“We work with three different promotion channels. Firstly, we place information and advertisements on the internet. Secondly, we work with mouth-to-mouth promotion in the cities where we are present. Thirdly, we have assigned local marketing teams that go from shop to shop to promote our business. In the beginning it was difficult to get the business started, but now things are picking up. We have a dedicated team of IT professionals that run our online shops. This is giving us a competitive advantage. In the short term we are looking to open online shops in Suzhou, Wuhan and Chengdu. In additional, we have plans to open 2 fruit shops in the big cities as a trial.”