China's cross-border e-commerce industry has suffered from performance pains due to adverse factors such as the Amazon Title issue since April 2021, repeated global epidemics and rising logistics costs.
From the newly disclosed annual report of 2021 and the first quarterly report of this year, the operation of cross-border e-commerce listed companies is generally poor, and the "sequelae" of Amazon's title still exists. However, after this incident, China's cross-border e-commerce enterprises began to reflect on their respective sales models and seek to break the situation. Some of them achieved remarkable results, the industry began to differentiate, and the e-commerce industry is showing four new normals of development.
Amazon title "sequela" still exists
Performance of some listed companies of cross-border E-commerce
Guangdong Saca Precision Manufacturing Co.Ltd(300464) ( Guangdong Saca Precision Manufacturing Co.Ltd(300464) ) cross border e-commerce business revenue mainly comes from Amazon platform. In 2021 and the first quarter of this year, Guangdong Saca Precision Manufacturing Co.Ltd(300464) revenue and net profit showed a double downward trend.
In 2021, the revenue of Guangdong Saca Precision Manufacturing Co.Ltd(300464) decreased by 33.74% year-on-year, and the net profit loss was 1.524 billion yuan, of which the revenue of cross-border e-commerce business decreased by 46.02% year-on-year. The company made provision for goodwill impairment and inventory depreciation for its cross-border e-commerce operator, Shenzhen Zebao Innovation Technology Co., Ltd., respectively, 680 million yuan and 416 million yuan. In the first quarter of this year, Guangdong Saca Precision Manufacturing Co.Ltd(300464) revenue and net profit decreased by 54.98% and 174.43% respectively year-on-year.
Regarding the decline in performance, Guangdong Saca Precision Manufacturing Co.Ltd(300464) said that in 2021, the covid-19 epidemic became normal, the cost of raw materials and cross-border logistics increased rapidly, and the company's cross-border e-commerce business was blocked by Amazon, so its operation was facing major challenges.
It is disclosed that in June 2021, Zebao technology, a subsidiary of Guangdong Saca Precision Manufacturing Co.Ltd(300464) company, encountered the "Amazon title" event, which impacted the performance in the second half of 2021. In 2021, a total of 367 sites of Zebao technology were closed on Amazon platform. By the end of 2021, the balance of funds frozen on the above sites was equivalent to about 322301 million yuan, and the company's wireless physical stores.
Coincidentally, revenue and net profit of Tiza Information Industry Corporation Inc(300209) ( Tiza Information Industry Corporation Inc(300209) ) also decreased in 2021 and the first quarter of this year. In 2021, Tiza Information Industry Corporation Inc(300209) revenue decreased by 64.91% year-on-year, and the net profit loss was 2.676 billion yuan; The net profit in the first quarter of this year decreased by 130971% and 13.300; respectively.
Tiza Information Industry Corporation Inc(300209) said that due to the adverse effects of changes in Amazon platform policy environment and fierce competition in European and American markets, the company's cross-border e-commerce business performance fell sharply in 2021, and its operating revenue decreased by 66.55% year-on-year; In addition, the company made provision for inventory depreciation of 771 million yuan for cross-border e-commerce business inventory and 724 million yuan for goodwill impairment of a tree operating the cross-border e-commerce business. In addition, due to the slow unfreezing progress of frozen funds of a tree in Shenzhen on Amazon platform, the company made provision for bad debts of 104 million yuan for the involved receivables based on factors such as suspected freezing reasons, appeal time limit and past unfreezing experience.
Guangdong Saca Precision Manufacturing Co.Ltd(300464) , Tiza Information Industry Corporation Inc(300209) the above situations are not isolated. The reporter found that at present, the international B2C cross-border e-commerce platforms mainly include Amazon (Amazon), eBay, wish, Walmart, Newegg, etc., of which Amazon is currently the largest global foreign trade trading platform, which means that as long as the cross-border e-commerce enterprises cooperating with Amazon platform, it is difficult to be alone in their performance last year.
Yiwu Huading Nylon Co.Ltd(601113) ( Yiwu Huading Nylon Co.Ltd(601113) ) the net profit loss in 2021 increased. The company expects the net profit of the year to be - 520 million yuan to - 780 million yuan, and - 196 million yuan in the same period in 2020. Tongtuo technology, a subsidiary of tongtuo technology, was seriously affected by the Amazon incident. At the end of the period, the company accrued corresponding asset impairment losses for inventories and accounts receivable.
Global Top E-Commerce Co.Ltd(002640) ( Global Top E-Commerce Co.Ltd(002640) ) it is estimated that the operating revenue in 2021 will be 7.8 billion yuan to 9.8 billion yuan, a year-on-year decrease of 42.42% to 54.17%, and the net profit will turn from loss to profit. However, it is mainly due to the bankruptcy and the recognition of investment income from the sale of assets. It is estimated that the deduction of non net profit will be - 1.6 billion yuan to - 2.3 billion yuan Hangzhou Lianluo Interactive Information Technology Co.Ltd(002280) ( Hangzhou Lianluo Interactive Information Technology Co.Ltd(002280) ) also has poor recent performance.
enterprises seek to break the situation
Since April 2021, Amazon has set off a wave of platform titles. According to the statistics of Shenzhen cross border E-Commerce Association, there are more than 50000 Chinese sellers whose stores have been closed or money has been withheld due to violations of Amazon platform, and the possible loss is expected to exceed 100 billion yuan. Apart from the small and medium-sized cross-border e-commerce sellers in the traditional sense, those who experienced the platform risk control event also included the top brand big sellers in Shenzhen, such as patuoxun, Aoji, Youshu and so on.
For the reasons for closing the store, Amazon's official explanation is that some sellers "improperly manipulate comments, put gift cards in goods, and use cash on social media to obtain false comments".
After this incident, the industry began to reflect on how to prevent and control platform risks and how to build a safe, stable and reliable platform development model. Some enterprises have put it into practice.
Taking Guangdong Saca Precision Manufacturing Co.Ltd(300464) as an example, the company's management said that after the Amazon Title issue, on the one hand, the company established a special emergency team to continuously communicate, coordinate and appeal with Amazon platform, protect the company's rights and interests from damage through reasonable and legal ways, and conduct self-examination and rectification of internal problems.
On the other hand, Guangdong Saca Precision Manufacturing Co.Ltd(300464) accelerated the promotion of the "multi platform, multi-channel" business strategy, expanded the online sales and self operated website sales of third-party platforms such as Walmart, eBay, Rakuten and Newegg, and strengthened the promotion of offline channels. In 2021, through non Amazon channels such as self operated platform (independent station), Wal Mart platform and offline channels, the operating revenue was RMB 605 million, a year-on-year increase of 92.06% compared with RMB 315 million in 2020; The total revenue of cross-border e-commerce accounted for 23.47%, up 16.87% year-on-year compared with 2020, further reducing the dependence on Amazon's single platform.
In addition, Guangdong Saca Precision Manufacturing Co.Ltd(300464) teamed up with suppliers to create new brand products. Continue to empower high-quality products produced by suppliers and sell them on Amazon through new brand identity and image. At the same time, the original brand products are sold in non Amazon channels and offline channels. According to the financial report, the revenue of Amazon platform accounted for Guangdong Saca Precision Manufacturing Co.Ltd(300464) revenue in 2021, which decreased from 93.4% in 2020 to 76.54%.
Tiza Information Industry Corporation Inc(300209) has also taken positive measures. The company said that due to the adverse changes in the policy environment of Amazon platform, the progress of the company's plan to build a brand matrix with the help of Amazon platform was not as expected, but the company's strategy and determination to focus on cross-border exports and strengthen the main business of e-commerce remained unchanged. In 2022, the company will further improve the construction of internal control system and pay more attention to the analysis, identification and prevention of platform policies and business risks, Balance the relationship between business efficiency and compliance operation, strive to reduce the adverse impact of changes in the policy environment of mainstream platforms such as Amazon on the company's subsequent operations, and strive to achieve stable operation of cross-border e-commerce business.
At the same time, Tiza Information Industry Corporation Inc(300209) also plans to increase the number of other non core business areas such as vehicle networking operation and software services, and strive to achieve a smooth transition in accordance with the established policy objectives.
Anker Innovations Technology Co.Ltd(300866) ( Anker Innovations Technology Co.Ltd(300866) ) in 2021, relying on Amazon and other online sales platforms, it entered more emerging markets and deepened its cooperation with well-known e-commerce platforms such as express and eBay.
e-commerce industry presents four new trends
The reporter observed that after the Amazon Title event, the whole e-commerce industry showed four new development trends:
First, the differentiation of cross-border e-commerce has intensified, and some enterprises with multi platforms, multi-channel or self owned platforms have stable performance and are expected to continue to improve;
Second, as the Amazon Title issue has brought more variables to the industry, many enterprises have seen new opportunities, resulting in more new entrants, intensified industry competition and face reshuffle;
Third, the performance of some Chinese enterprises engaged in similar business with Amazon has improved. Amazon's title has enabled enterprises to strengthen the expansion of other platforms, which is conducive to the development of other e-commerce platform enterprises;
Fourth, new changes have taken place in China's e-commerce channels. The sales of interactive platforms such as Tiktok and Kwai have increased rapidly.
Anker Innovations Technology Co.Ltd(300866) is mainly engaged in cross-border e-commerce business in the field of consumer electronics. Its products mainly include three series: charging, intelligent innovation and wireless audio. In 2021, Anker Innovations Technology Co.Ltd(300866) achieved a total revenue of 12.57 billion yuan, a year-on-year increase of 34.45%, and a net profit of 982 million yuan, a year-on-year increase of 14.7%.
It is understood that Anker Innovations Technology Co.Ltd(300866) has formed a three-dimensional sales model of "Online + offline". In 2021, its offline revenue accounted for 36.38% of its main business revenue, with a year-on-year increase of 4.48%. The company said that it continued to implement the channel expansion plan, improved the multi-channel and multi-level sales system, and sold its own brand consumer electronics products to consumers all over the world.
Focus Technology Co.Ltd(002315) ( Focus Technology Co.Ltd(002315) ) is the beneficiary of Amazon's title event. Its revenue and net profit in 2021 increased by 27.3% and 41.33% year-on-year respectively, and the revenue and net profit in the first quarter of this year increased by 5.18% and 108.09% year-on-year respectively Focus Technology Co.Ltd(002315) performance growth is mainly due to cross-border B2B e-commerce platforms such as its full link foreign trade service integrated platform made in China and kaigong, which are designed to help Chinese enterprises better go to sea. In 2021, the revenue of China manufacturing network accounted for 74.63% of the company's total revenue.
Focus Technology Co.Ltd(002315) said that in 2021, under the catalysis of the epidemic, the trend of online foreign trade in China and even the world accelerated. With the new pattern of China's "double cycle" strategic development, cross-border B2B e-commerce has become a strong growth point of China's foreign trade, and the transformation and upgrading of traditional foreign trade enterprises has become an inevitable trend. In this context, the company actively gives play to the advantages of Internet technology and platform resources, and helps Chinese manufacturing enterprises expand overseas trade market through continuous product technology innovation, service mode innovation, operation management innovation and marketing mode innovation.
Xiamen Jihong Technology Co.Ltd(002803) ( Xiamen Jihong Technology Co.Ltd(002803) ) in 2021, the revenue increased by 17.40% year-on-year and the net profit decreased by 59.32% year-on-year. Among them, the revenue of cross-border e-commerce business increased by 11% year-on-year and the net profit decreased by 53% year-on-year.
According to the relevant person in charge of the company, Xiamen Jihong Technology Co.Ltd(002803) the above performance is mainly due to the significant increase in the cost of the whole cross-border e-commerce supply chain due to the long-term impact of the epidemic. At the same time, China's cross-border e-commerce enterprises emerge frequently, the industry competition intensifies, and disorderly and low-cost competition further raises costs and reduces profits; In addition, the epidemic situation in some overseas areas is more serious, resulting in a continuous decline in consumers' purchasing power.
In addition, from the perspective of the whole e-commerce industry, some e-commerce enterprises focusing on the Chinese market have shown new changes in their sales channels. .
Nanji E-Commerce Co.Ltd(002127) said that the rise of the new platform reflects the stronger consumer reach and penetration, the sinking market's demand for consumption upgrading, and consumers' demand for product content. In the future, the company will further build a brand matrix to bring more and better products to more consumers, and further tap potential incremental channels.
e-commerce industry continues to improve
Although the industry is faced with adverse factors such as logistics obstruction, rising costs and declining consumption power caused by covid-19 epidemic, as well as international policy risks such as Amazon title, on the whole, the whole e-commerce industry will continue to improve in the future.
On April 29, the A-share e-commerce sector broke out collectively. As of the closing, 43 stocks rose by more than 9%, of which 5 stocks including Guangdong Saca Precision Manufacturing Co.Ltd(300464) , Aoki shares, Shanghai Kaytune Industrial Co.Ltd(301001) , Hangzhou Onechance Tech Corp(300792) , Beijing Zhidemai Technology Co.Ltd(300785) , etc. rose by 20%.
On the news side, the Political Bureau of the CPC Central Committee held a meeting on April 29 to analyze and study the current economic situation and economic work and consider the national talent development plan during the 14th five year plan. The meeting stressed the need to promote the healthy development of the platform economy, complete special rectification of the platform economy, implement normalized supervision, and introduce specific measures to support the standardized and healthy development of the platform economy.
From the perspective of data, the overall trend of cross-border e-commerce export industry continued to improve in 2021. Global online retail sales reached US $4.94 trillion in 2021, an increase of 16.2% over 2020, accounting for 19.6% of global retail sales. It is expected that global online sales will increase to US $7.39 trillion by 2025.
In addition, according to the data released by the National Bureau of statistics, the online retail sales of physical goods in 2021 were 10.8 trillion yuan, an increase of 12.0% over the previous year, accounting for 24.5% of the total retail sales of social consumer goods. E-commerce channels still maintained vitality and steady growth.
In terms of policy, in March 2021, the State Council issued the 14th five year plan and 2035 vision, which proposed to accelerate the development of cross-border e-commerce, encourage the construction of overseas warehouses and ensure the operation of the supply chain of foreign trade industry; In November of the same year, the Ministry of Commerce issued the high-quality development plan for foreign trade in the 14th five year plan, which pointed out that we should actively expand imports, optimize exports, promote the high-quality development of foreign trade, and support the accelerated development of new trade formats, including promoting the sustainable and healthy development of cross-border e-commerce, giving full play to the leading role of foreign trade comprehensive service enterprises, and accelerating the development of overseas warehouses. Cross-border e-commerce exports are becoming a new driving force for China's "stabilizing foreign trade".
Huachuang securities research report pointed out that since 2021, Amazon's rules have become stricter and a large number of Chinese seller accounts have been closed. In one year, the proportion of Chinese brands of Amazon's top merchants fell from 42.3% to 36.9% at the end of 2021. The sellers of "Pan product + third party" were seriously damaged, while most of the top sellers were not affected in this round of reshuffle. The exit of some cross-border sellers represents the reduction of similar competitors sharing industrial dividends, and the released share will accelerate the concentration to high-quality leaders with more brand awareness.
Gf Securities Co.Ltd(000776) analysts said that in 2021 and the first quarter of this year, consumer demand was sluggish, express delivery performance was blocked, leading trading platforms shrank their expenses to survive the cold winter of the industry, and the growth of sales revenue of leading e-commerce companies slowed down or decreased. However, Longtou Pingtai has increased its repurchase in recent times, demonstrating the recognition of the company's value by the management and the optimism of the industry in the future.
