The future of pharmacy
Several years ago, Andrew Stent, owner/operator of multiple pharmacies in Perth, noticed “Daigou” personal shoppers clearing a number of product lines from his shelves to send back to family and friends in China.
He sensed an opportunity to tap into this market and sell the desired products directly to China.
Having seen the demand from these Daigou – literally, “surrogate” shoppers - Andrew has reshaped his business to better serve them. He noticed these shoppers were highly engaged with their mobile phones and social media to sell and promote products to their networks.
Critically, accepting Chinese payment platforms (WeChat Pay and AliPay) at point of sale and online was essential to grow sales.
Andrew says “In Australia, there may be a segment of the local market that businesses may be missing out on, simply because they don’t offer the relevant China payment solutions. The investment can be low and easily attract new customers to a business.”
Chinese customers look for comprehensive product information when shopping online for cross-border eCommerce products.
Andrew has developed a cross-border eCommerce business with a business partner, an experienced dairy exporter who was born in China and based in Perth for 20 years. They collaborated on strategy and development for six months before launching an online store.
Having a business partner that is well respected in China has helped in navigating the complex Asian market.
They have also released a shopping app which showcases Australian health care products, alongside a WeChat store that operates inside the main social network app.
Product inventory is now shipped in bulk to Free Trade Zone warehouses in two locations in China to fulfil individual orders locally, rather than sending individual packages from Australia.
Tips for other Australian brands
Andrew points out that while China is a massive country, there is no need to try and conquer all of it. The biggest cities draw in competition from all over the world. His advice is:
“Focus on other cities where the living quality is improving rapidly. Many of those cities are home to millions of mobile-connected consumers. You could be the only Australian business providing your type of product or service to a city of 3 million people.”
New opportunities in less competitive markets
During his research stage, Andrew visited several smaller (so-called Tier 3 and 4) cities in China and identified the opportunity to develop his own brand of health and beauty products.
Andrew says “these Chinese shoppers thought of Australia as clean, green and safe with high quality products, however they did not immediately recognise all of the most well-known brands. It is possible to promote our own product, alongside the large range we already carried”.
With the support of their own team in Shanghai and Hangzhou conducting market research, combined with sales and customer support locally in China, the partners have developed their own BioZen branded product range to be released in 2020.
With such a massive market to serve, the marketing expense could be very large. Andrew says although this is one of the biggest challenges, the key is to set this up as an integrated system that keeps growing organically.
“By having a strong foundation to keep customers connected, they are more likely to return with more orders as they spread the word to their networks,” he says.
This is a powerful channel not to be underestimated.
The latest ANZ Opportunity Asia Report combines survey data from 1000 businesses across Australia along with timely case studies and industry research, to understand how companies are adapting to the COVID-19 environment. It provides actionable insights to help build a recovery and growth strategy for Asia. Download the report from: https://betradeready.anz.com/OpportunityAsia
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