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Daigou

China’s food scandals give rise to army of Australian shoppers

In 2013, student Na Wang began shipping fish oil capsules to China from Sydney to help pay the rent. Now, she’s in business, part of a growing army of Chinese shopping agents sending Australian food and diet pills home to feed rampant demand.

Wang, 33, is one of up to 40,000 Chinese ‘daigou’ in Australia, retail consultants say, using social media and mobile payment apps to buy goods to order for mainland China customers.

While daigou first made waves in the West shipping luxuries from Europe like Gucci handbags, the new Australia breed deals in ‘white gold’ – baby milk formula – and other consumer staples.
More affluent, health-conscious Chinese shoppers want safe Australian goods, a trend stoked by tainted China food supply scandals.

This year, brands like formula maker A2 Milk have begun exploring ways to harness the growth of daigou, rather than compete with them, targeting cross-border e-commerce that’s seen by consultancy ThinkChina at $1-trillion this year.
“People in China just love Australian products,” said Wang, boxing up an order of Maca Plus, a powder said to boost libido, and detox treatment Fatblaster Coconut.

“They like the quality,” said Wang, an economics graduate from Shandong province still studying English as she looks for a job. “Nothing is expensive for them.”

It’s not all plain sailing for daigou, back home or in Australia. In April, Beijing tightened rules on cross-border online shopping, though in Australia shoppers like Wang say orders haven’t been hit.

Meanwhile, at the height of a 2015 boom in demand for milk formula from China, triggered by a food safety scandal, daigou attracted criticism in some Australian media for vacuuming up supply and leaving domestic shoppers empty-handed.
But the scale of the new trade has alerted retail brands to potential new sales via daigou tie-ups that might otherwise be beyond the reach of mid-tier consumer goods makers.
“Everyone’s working on it (daigou tie-ups) now, including all the big brands,” said Benjamin Sun, director at ThinkChina. “If you think about global markets, what Australia can offer to Chinese online consumers is food, supplement and dairy, not so much fashion and luxury goods.”
Daigou – meaning ‘on behalf of’ in Chinese – establish a network of prospective customers on popular online messaging app WeChat, owned by internet giant Tencent.
Some, like Wang, even broadcast their shopping live via WeChat’s video service to show buyers the products are genuinely from stores in Australia, not counterfeit Chinese goods.
Wang and her daigou competitors typically charge premiums of about 50 percent above the sticker price on Australian store shelves. But even allowing for shipping fees, that still means the buyer pays much less for the same product in a Chinese store – assuming it is available…..

Reuters: Read the full article

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