On May 25, at the China-Russia cross-border e-commerce development sub-forum of the Guangzhou Xiaomanyao Science and Technology Conference, a reporter from China Business News learned that Russia's e-commerce transaction volume will increase by more than 30% year-on-year in 2022, and it is expected to continue to grow by 25% year-on-year in 2023. %-30%. This provides a good opportunity for Chinese brands to enter the Russian market, and the potential for cross-border e-commerce between China and Russia is huge.
The next seven years will be a golden period for China-Russia cross-border e-commerce
Huang Xiao, president of Russia's mainstream e-commerce platform Ozon China, predicted that based on favorable policies, from 2023 to 2030, China-Russia cross-border e-commerce business will usher in opportunities for rapid development. In the future, more Chinese brands will enter the Russian market, starting with online channels, and then develop through all channels online and offline.
With the withdrawal of European and American brands from the Russian market, the reconstruction of the supply chain will bring a golden window of opportunity for new brands and new supply chain companies, and the replacement of the supply chain will change from 'filling market vacancies' to 'localized brand development'. For example, Huang Xiao said that the notebook computer brand 'maibenben' (only sold in Russia) founded by a Guangzhou company has already ranked among the best in Ozon's notebook computer shipments. For another example, the sweeping robot brand 'Neatsvor' (only sold in Russia) founded by a Hangzhou company has taken shape in Russia and is being promoted online and offline. Geely Automobile has also developed well in the Russian market.
In March of this year, China and Russia issued the 'Joint Statement on the Development Plan of the Key Directions of Sino-Russian Economic Cooperation Before 2030', pointing out that China and Russia will first expand the scale of trade, optimize the trade structure, and develop e-commerce and other innovative cooperation models; Secondly, vigorously develop the interconnected logistics system; in addition, the level of financial cooperation will also be improved.
Huang Xiao believes that the potential of the Russian e-commerce market is huge. The current penetration rate of Russian e-commerce is about 10%, while the penetration rate of China's e-commerce has reached about 30%. Therefore, the Russian e-commerce market has the opportunity to double its growth in the future. As of 2022, there will be about 129.8 million Internet users in Russia, with an Internet penetration rate of 90.5%, while the proportion of online shopping users is only 46%.
China-Russia digital trade promotes new logistics infrastructure, and 'four warehouses and four transportation' builds an export logistics network, including front warehouses, border warehouses, bonded warehouses, local warehouses, as well as China-Europe trains, air charter flights, Qatar Airways land transportation, and sea transportation. Huang Xiao said that the logistics between China and Russia include the west route through Xinjiang, the middle route through Inner Mongolia, and the east route through Heilongjiang and Jilin. Jilin and Heilongjiang are building large-scale free trade zones. In the future, Chinese goods can be placed in the Northeast at low cost and then exported to Russia.
'The China-Europe Railway Express is developing rapidly. There will be 50 trains in 2020 and 774 trains in 2022, two trains a day.' Huang Xiao said that shipping has also increased a lot, and most of China's major ports have routes to Russia. Ozon also cooperates deeply with China Post to jointly build a logistics system for Sino-Russian cross-border e-commerce.
In terms of finance, by 2022, the proportion of Russia's settlement in RMB will increase by 9 times, and RMB will account for 25% of its total foreign currency settlement; the proportion of RMB settlement in Russia's import trade will rise to 23%, and the use of RMB in third-party foreign trade settlement will be promoted.
Based on this, Huang Xiao said that in 2023, Ozon China will focus on developing several projects: 2.5 billion ruble traffic promotion subsidy plan; promotion of e-wallet and RMB settlement; comprehensive deepening of logistics strategic cooperation with China Post; construction of front warehouse from south to north And border warehouses, set up warehouses in Hong Kong, Shenzhen, Yiwu, Suifenhe, Vladivostok and other places, and then airlift the goods to Moscow.
China-Russia cross-border logistics and payment continue to improve
Zheng Shuangyin, deputy general manager of China Post Guangdong Branch, said that the trade volume between China and Russia continues to grow, reaching US$190.27 billion in 2022, a year-on-year increase of 29.3%, of which China’s exports to Russia have a growth rate of 12.8%, and Russia’s e-commerce compound growth rate up to 33.6%. In order to seize this opportunity, China Post and the Ozon platform launched the online delivery e-mail treasure service.
At present, Guangdong Post has established 33 Ozon online delivery service teams in seven cities including Guangzhou, Shenzhen, Dongguan, Foshan, Zhongshan, Jiangmen, and Yangjiang, providing door-to-door pick-up services starting from 5 pieces/10 pieces. In terms of air services, suitable categories include household products, children's products, clothing, pet care, etc. Live products are not allowed, and the weight limit is 3 kg. In terms of land transportation services, on the basis of general cargo, products such as electrified products and kitchen knives can be added, and the weight limit is also 3 kg. In the next step, China Post’s China-Russia cross-border logistics business plans to increase commercial line services, large-scale logistics solutions, and self-collection point services.
The cross-border payment business between China and Russia is also developing. Zhong Yi, the person in charge of the integrated business of Lianlian International, said that in 2022, the transaction volume of Russian e-commerce will reach 4.98 trillion rubles (approximately 67.47 billion U.S. dollars), a year-on-year increase of over 30%; e-commerce will account for 11.6% of Russia’s retail trade in 2022 , an increase of 2.4 percentage points from the beginning of 2022. It is estimated that the transaction volume of Russian e-commerce may increase by 25%-30% in 2023. In recent years, Russia’s e-commerce consumption categories have been stable, with jewelry and watches, tools and gardening equipment, and sports goods seeing the largest growth rate; in 2022, electronics and home appliances, furniture and household items, clothing, shoes, food, beauty and health care products will account for Russia’s consumption respectively. 22%, 18.3%, 14.5%, 13.2% and 7.7% of the total e-commerce transaction volume. Lianlian International became Ozon's first official payment partner last October. In March, Ozon encouraged sellers to accept payments through digital payment methods.
As an agent who has developed cross-border trade business in Russia for 6 years, Wang Hong, general manager of Guangdong Xinxun Technology, believes that the current consumer electronics market in Russia is facing an opportunity to 'reshuffle', first of all, the parallel import supply of European and American brands Chain replacement; then Chinese and Russian local brands will replace European and American brands. He took mobile phones as an example. In 2021, Xiaomi, Samsung, Realme, and Apple accounted for 23%, 30%, 5%, and 13% of the Russian mobile phone market respectively; in 2022, their shares will become 35%, and 15.1% in turn. , 14.6%, and 7.3%, Transsion’s share in the Russian mobile phone market soared to 14.3%.
Localization, heavy assets, and high investment are the practices of Chinese brands that will achieve significant growth in the Russian mobile phone market in 2022, including holding large-scale offline promotional activities. Wang Hong believes that as Ozon actively develops cross-border e-commerce business, when it completes the layout in terms of traffic entry, warehousing integration, delivery timeliness, and settlement channels, it will bring a cross-border e-commerce model to Chinese brands, which can realize light assets Optimized operation and precise investment. In the future, in addition to Chinese brands directly opening stores on Ozon, it is expected that Ozon will also actively develop cross-border e-commerce merchandise direct sales business, which will directly connect with China's supply chain resources.
Wang Hong reminded that, in addition to Ozon’s active development of cross-border e-commerce business, changes in the equity of AliExpress’ Russian business, whether TEMU is preparing to enter the Russian market, and the actions of Ozon’s friend in Russia, WildBerries, are also worthy of attention. 'Russia is a relatively independent market, which will bring opportunities for new brands such as maibenben.'