Introduction to China
China is a communist state in Asia. It has a population of 1,388.2 million people and its capital is Beijing. The official language is Mandarin and widely spoken foreign languageare Cantonese and Shanghainese. China has a GDP of $11,8 billion USD, which represents a GDP per capita of $8,480.65 USD in 2017.
- 1,388.2 million people
- GDP of $11,8 billion USD
- 4.0% unemployed
- Inflation of 2.0%
Ecommerce in China
In 2017, the Chinese B2C ecommerce turnover grew by 19.96% to $681.9 billion USD. China had an online population of 583.1 million of people who were aged 15 and older. Of the total online population, 413.3 million bought something online in 2015. The average spending per eShopper was $1,505 USD in this year.
|B2C Ecommerce Turnover||$681.9 billion USD|
|B2C Ecommerce growth||19.96%|
|Online population||583.1 million|
|Number of eShoppers||413.3 million|
|Most popular payment method||eWallet|
Tips for ecommerce in China
China is in the midst of a consumer revolution, with foreign products taking advantage of advanced marketing, advertising and research techniques. Brand awareness is increasingly important and sophisticated advertising is beginning to play a key role in attracting Chinese consumers. Producers of luxury goods and providers of services have seen large growth in China.
Chinese society is often viewed as “collectivist”, with the group prevailing over the individual. As a result, the standards, preferences and standards of the group to which an individual belongs have a tremendous influence on purchasing habits. The golf craze – with over one million taking up the sport in recent years – is an example of the desire to belong to a group (the affluent) and subsequent conformity to the preferences of said group. For this reason, advertising is frequently directed at groups, rather than individuals.
Today, the elite among the single-child generation want to live a good life and are not shy about spending – including on education, luxury items, travel, leisure activities and consumption goods – especially those in large cities. The consumption is often aimed towards high-end, big-name products, as evident by the explosion in the number of luxury cars. Largely due to the desire to conform with the affluent reference group, there are few individuals ready to run the social risk of being “different” or stray too far from the standard. At the same time, once a product is adopted by the reference group, the passion for it rapidly catches on far and wide.
Chinese consumers tend to be very brand-sensitive. They believe price to be an indicator of the quality of a product, though both price and sales services are the most important selection criteria. Aspects such as warranty and possibility of product refund are less important. Generally, the Chinese attach great importance to researching a product before purchasing it, the principle source of their information being word of mouth.
Non-resident traders operating in China, unlike Europe and many other parts of the world, cannot register for VAT as non-resident traders. If a trader is providing services into China, its local representative or its customer is responsible for accounting and reporting the tax. It is more usual in China for non-resident traders to form a local company (e.g. WOFE) in order to register for VAT.
Before trading in China, we recommend visiting the Q&A Online Taxes and VAT in China page.
The Chinese Ecommerce Association, SCEA & BECA
SCEA is an association with more than 200 registered member enterprises as well as nearly 180 potential member enterprises, which could be mainly divided into 6 categories, i.e. logistical and express enterprises, financial and payment enterprises, E-commerce enterprises, E-platform enterprises, international trade enterprises, and third-party services providers.The operation scope of SCEA can be concluded as follow: standards formulation, consultation service, industry investigation, data statistics, conferences and exhibitions, personnel training, cooperation and communication, industry self-discipline and other affairs contracted by the government.