Singles' Day highlights deficiencies of e-commerce in western region

XI'AN -- The online buying spree of this year's Singles Day has exposed the development obstacles faced by online sellers in China's underdeveloped western areas.

Zhang Anle runs an online garment store from Xi'an City in northwest China's Shaanxi Province. On Singles Day on Tuesday Nov 11, he spent more than 5,000 yuan ($814) on personal purchases, while his store only sold out one coat.

"I am getting used to being a buyer rather than a seller," he said, adding that he had always lagged behind his competitors in eastern areas.

Zhang's embarrassment is shared by many of his peers in the western regions of China. Statistics from the government of Gansu Province shows that the ratio between online sales from the province to the rest of the country and online consumption by the local people for products from outside the province was 1:17 last year.

Kong Shuanmin, chairman of Houhou network technology company in Shaanxi, said, e-commerce in the west started late and was laid on a weak foundation.

"Manufacturing industries are concentrated in the east, which has provided online sellers with an adequate supply of goods and advanced e-business platforms and also helped lower the cost of storage and delivery," he said.

"However, e-commerce enterprises in western areas lag behind their eastern counterparts in terms of goods supply, sales channels, delivery and talent pool," he added.

Zhang Anle said that many of the things sold by western sellers were produced in the eastern areas.

The clothes in Zhang's store are made from materials sourced mostly from the provinces of Fujian, Zhejiang and Guangdong. The delivery cost has pushed up the price of the products and the supply of products cannot be ensured on big shopping fiestas, such as 11.11, he said.

Way out

Experts say sellers in western regions should hone their competitive edge by concentrating on local specialty products.

According to the government of Shaanxi, the province's online trading volume for agricultural products for the first half of this year had grown over twofold from the same period last year.

Du Mingrui is the manager of di877.com, an e-commerce platform selling specialty food from Shaanxi such as preserved fruits and pastries.

Du said that his company dared not join the promotion frenzy of Singles Day, as the possible surge in demand could outstrip supply.

"Production capacity is limited for manufacturing as it is mostly based on traditional craftsmanship," he said.

Kong Shuanmin said that e-commerce enterprises in the west should find ways to improve capacity and promote production standardization.

As the western region's e-business was still emerging, local governments should help businesses integrate resources in order to realize scale development and build up brand awareness.

The government should also encourage e-commerce talent by offering preferential policies and on-the-job training for e-commerce practitioners, he suggested.

Wugong County in Shaanxi is an example of rapidly developed e-commerce aided by the government.

The county government has established such platforms as the e-commerce association, agriculture products e-commerce service center, and agriculture products quality examination center, in an effort to encourage growth in e-commerce.

So far, the county has more than 200 e-commerce stores that employ over 1,000 people and their total daily trading volume is about 800,000 yuan on average.

Du Mingrui said that the construction of a complete production chain could greatly help the development of e-commerce in the western areas.

"Hopefully, the government can also encourage the establishment of service enterprises, helping new e-business companies solve problems such as financing and sales promotion," he said.

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