"The next three years will still be a golden period for the development of digital trade. On the Asian scale, it is gratifying that a large number of micro-multinational companies are rapidly emerging, not only to achieve business in multiple overseas markets thousands of miles away, but also to grow into the main force of global trade in the future. Deloitte China Vice Chairman Lam Guo-en said.
On December 14, Deloitte released the 2021 "Technology Empowers Asia-Pacific Digital Trade" report, which analyzed in detail the changes in the Asia-Pacific digital trade ecosystem, and for the first time proposed that with the help of RCEP policy dividends and digital technologies, a number of Asian small and medium-sized cross-border e-commerce companies are growing into "micro-multinational enterprises".
Policy + technology dividend: Asia-Pacific digital trade enters a strong growth cycle in the next three years
In 2020-2021, the epidemic has accelerated the digitalization process of consumers and merchants, global buyers have become accustomed to online shopping, and the growth of global trade continues to refresh people's cognition.
According to UNITED Nations statistics, in the third quarter of 2021, global merchandise trade exceeded $5.6 trillion, a record high. According to the statistics of the General Administration of Customs of China, the import and export of Cross-border E-commerce in China increased by 20% in the first three quarters of this year; and last year, its scale reached 1.7 trillion yuan, of which exports accounted for two-thirds, an increase of 40%.
But that growth is just beginning. The Deloitte report pointed out that under the influence of technological progress, international cooperation and openness, global trade is entering an intelligent upgrade. The landing of important digital infrastructure, including 5G, and the superposition of massive big data on artificial intelligence have made intelligent decision-making possible and helped open the era of internet of everything. Technological upgrading has attracted more and more cross-border e-commerce companies to join the global industrial chain of digital trade to meet the growing digital consumption habits of global consumers, and the Asia-Pacific region will become a new force in the construction of global digital platforms.
At the same time, relevant policies in different regions of the world are frequently introduced. On the one hand, on November 15, 2020, the 10 ASEAN countries and 15 countries, including China, Japan, South Korea, Australia and New Zealand, formally signed the Regional Comprehensive Economic Partnership Agreement (RCEP), which will enter into force on January 1, 2022. The RCEP will promote regional digital trade in five major areas: eliminating tariff barriers, establishing flexible rules of origin, promoting e-commerce, improving trade facilitation, and attaching importance to small and medium-sized enterprises and technical cooperation. On the other hand, from 1 July 2021, the EU VAT reform was officially implemented, and the main reform priorities include the abolition of the VAT exemption of 22 euros, the unification of the taxable registration threshold for long-distance sales, the expansion of the scope of application of the "one-stop" compliance mechanism, and the clarification of the VAT tax obligations of e-commerce platforms.
In this regard, the Deloitte report predicts that in the future, digital trade activities in the Asia-Pacific region will show a comparative strengthening, technology dividends will be superimposed on policy dividends, and in the next three years, Asia's "micro multinational enterprises" will usher in their own key leaps.
Seventy percent of "micro-multinational enterprises" want to build their own independent stations
How is "micro-multinational enterprise" defined? According to Deloitte's survey of more than 600 cross-border e-commerce companies in Too Many Asian countries, 85% of cross-border e-commerce companies are small and micro enterprises with less than 100 people, and the least even one or two people, covering an average of more than 3 overseas markets. Their exports to the world's hot top goods include 3C, home, beauty, clothing, etc., the mainstream market they bring is currently the European and American markets, but Southeast Asia is recognized by the industry as the fastest growing tomorrow's market.
Portrait of a micro multinational corporation
The founders of these "micro-multinational enterprises", most of whom are post-80s and post-90s, are Internet natives, no longer like the older generation of foreign traders who are limited by orders from international purchasing giants such as Walmart. They are adept at confronting and spotting consumer demand from global social networks, using "locally made" and flexible supply chains in Asia Pacific to provide DTC (Direct To Customer) light customization for equally young overseas consumers.
On which platforms do "micro multinationals" bring goods? The report shows that 64% of their business is carried out on Amazon, 31% on eBay, 18% of them do self-built websites and Lazada, 14% are carried out in AliExpress, and 13% are doing other overseas local e-commerce platforms. Don't put your eggs in one basket, this is the business experience of Asia's "micro multinationals".
Establish independent stations in mature markets to investigate the intentions
Survey of intentions to establish independent stations in developing markets
It is worth mentioning that a significant change since the beginning of this year is that 30% of enterprises have built their own independent foreign trade websites, and 70% of enterprises also hope to build independent websites (independent websites). Compared with the previous dependence on large platforms such as Amazon, the rise of self-built independent stations is a sign of the awakening of the independent brand awareness of "micro multinational enterprises", which can not only eliminate the "entry fee" of third-party e-commerce platforms, avoid being subject to the restrictions of the rules of large platforms, but also face consumers more directly, so that "fans" are more loyal to the brand, follow-up promotion and newness have more initiative, and digital trade data is safer.
Cross-border financial services in the RCEP region are stable and "micro multinational enterprises" are vigorous
On the same day, Zhejiang University and Ant Research Institute also jointly released the "RCEP Regional Digital Trade Cross-border Payment Service Index", and the capital settlement channel capacity of Asia-Pacific cross-border e-commerce has been significantly improved, of which "micro multinational enterprises" have the highest activity and vitality value.
From the perspective of small and medium-sized sellers in the 15 countries of the RCEP Agreement, the index integrates a series of indicators such as the number of sellers participating in cross-border collections, the amount of transactions, the number of payments, the average duration of payments and the currency of payment, comprehensively reflecting the breadth, depth, activity, payment efficiency and payment convenience of cross-border financial services, and measuring the overall service level change of the industry from the two dimensions of cross-border financial service scale and service quality.
The index shows that from the first quarter of 2018 to the present, cross-border financial services in the RECP region have shown strong resilience, with the total index rising nearly 2 times in 4 years and reaching an annualized growth rate of 18.55%. Especially in terms of scale, the year-on-year growth rate of the cross-border payment service scale index in 2020 reached 53.5%, and the annual growth rate in 2021 was 14.7%, both maintaining double-digit growth. Among them, the payment activity measured by the number of payments is far ahead of the growth of sellers and the growth of transaction amounts, and in Q3 2021, it increased by 25.6% year-on-year, a record high. In this regard, Professor Ben Shenglin, dean of the International United Business School of Zhejiang University, explained, "This shows that small and medium-sized sellers are increasing, and orders are gradually showing the characteristics of fragmentation and small singleness, which confirms the rise of 'micro multinational enterprises' in Asia." ”
At the press conference, several report publishers shared the feedback of the surveyed merchants on the current cross-border e-commerce business. On the one hand, "waiting for the ship to come" has become a common anxiety in the industry, and the recent "container fever" has affected the delivery efficiency of "micro multinational enterprises", and the high logistics costs and difficulties in customs clearance and inspection have become the biggest challenges facing us at present. Taking the Sino-US sea route as an example, the recent container freight rates on the Shanghai-West Coast route from China to the West Coast of the United States have climbed from $1,300 to more than $4,000, and the freight time to the port of Long Beach in the United States has been dragged so long that it is likely that ships will not be able to enter the port for 9 days.
On the other hand, "micro-multinational enterprises" are relatively satisfied with the efficiency of cross-border collections. The report shows that among china-Japan-South Korea cross-border e-commerce sellers, the fastest-growing cross-border collection tool is WorldFirst, with a market share of more than 40%. In the past, the overall cycle of foreign trade payment collection took at least 1-2 months, and WorldFirst not only allowed "micro multinational enterprises" to arrive in seconds, which greatly alleviated the pressure on capital turnover; it could also withdraw money to Alipay, which was convenient for Chinese cross-border e-commerce sellers to go directly to the largest domestic trade wholesale platform 1688 and then purchase goods.
"In the era of digital technology, payment technology gives small and micro enterprises the opportunity to grow into micro-multinational enterprises, allowing them to sit on the global digital trade train with a very low threshold, and even sit in the same class as those multinational large enterprises!" Ben Shenglin, dean of the International United Business School of Zhejiang University, said.
Fan Jian, head of China at WorldFirst, said frankly that in the process of "micro-multinational enterprises" going to sea, they need more policy and technical support to help them receive and pay faster, more convenient and more secure cross-border receipts and payments, in order to quickly seize the global digital trade opportunities that are changing every minute. "We have recently provided a variety of services such as online business loans and US dollar loans for cross-border merchants who are busy with Christmas hotspots, hoping to use the power of technology to help them 'grab chips' in the annual war they value most, to alleviate the financial pressure of their centralized demand for stockpiling and delivery." Soon, with the entry into force of the RCEP agreement next year, China's micro-multinational enterprises will usher in a greater outlet. ”
Written by: Nandu reporter Xiong Runmiao