The Implementation Of The Law Of The People'S Republic Of China On Electronic Commerce Is Imminent. Will It Be Impossible To Find A Purchasing Agent In The Future?

"I estimate that 70% - 80% of people will fail."

Ren Zhilu is an overseas purchasing agent and has been in business since 2004. His pessimism comes from Electronic Commerce Law of the People's Republic of China ——This is on The new law officially issued in September 2018 will come into force on January 1, 2019. The E-Commerce Law requires that practitioners who are defined as e-commerce operators must conduct formal registration, obtain relevant business licenses and pay taxes in accordance with the law. However, substantive e-commerce operators, such as live broadcast purchase and WeChat business, which were previously in areas where the rule of law was ambiguous, are included in the supervision scope of the Law.

"I think this is the trend of the times. The gray profession of purchasing on behalf of others may have completed its historical mission," Ren Zhilu added.

Luxury group also made a statement on purchasing agency half a month ago.

Own Louis Jean Jacques, Chief Financial Officer of LVMH, a French luxury goods group with brands such as Vuitton and Celine, at the conference call to announce the third quarter results of fiscal 2018 Guiony publicly supported the Chinese government's action to crack down on purchasing agents, and said that the group had already launched a series of attempts such as store purchase restrictions in order to crack down on purchasing agents.

　　 The birth of "human flesh purchase"

A large number of people in the purchasing agency have the experience of studying abroad, working or even settling down. Ren Zhilv started to buy things on behalf of others - to be precise, he only carried things for his relatives and friends in China at that time - because he was studying in Japan at that time. It was still in 2004. His classmates and friends around him often helped his family buy something to bring back to China, but they didn't make a profit. This is the prototype of the legendary "human flesh purchase".

The so-called "human flesh purchase agent" refers to those who use luggage and backpacks to load overseas goods and bring them into China through the journey home and abroad. Often, they will charge a certain fee when giving goods. Some people only charge "hard money", while others charge 10 yuan or 20 yuan for larger items. Others found the opportunity to become rich and collected money at 10% or more of the commodity price.

Gradually, with the increase in the number of practitioners, purchasing on behalf of others has really become a profession worthy of name. A very important foundation behind this is that since China's reform and opening up, especially after entering the 21st century, there has been a craze for studying abroad. According to the data released by the Ministry of Education in March 2018, over the past 40 years of reform and opening up, China has accumulated 5.1949 million people studying abroad, of which the number of Chinese students studying abroad exceeded the 600000 mark for the first time in a single year in 2017.

"Most of the purchasing agents I know are international students, and I feel that 90% of them have started purchasing agents just one month after their arrival," Tang Hao Chenyu, a doctoral student in Russia, told the interface reporter. Tang Hao Chenyu is currently working part-time as a guide in DLT Department Store, a high-end shopping center in St. Petersburg, Russia, and will also be a guide in his spare time. In DLT Department Store, a large part of his customers are international students who do purchasing on behalf of others.

"When you buy luxury goods, cosmetics and vodka in Russia, the same things will be much cheaper than those in China. Here is the pricing in Europe. Sometimes shopping malls often make great efforts to discount in order to promote sales, and some goods can also be refunded." Tang Hao Chenyu said, "This gives the living space for purchasing agents."

The price difference of the same goods in the domestic and foreign markets not only brings profits to the purchasing agents, but also stimulates the purchase desire of domestic consumers. In addition, with the increase of income and brand awareness, domestic consumers' demand for overseas high-quality goods has exploded.

A set of data released by the Ministry of Commerce in 2017 shows that from 2005 to 2014, the average annual growth rate of China's overseas consumption was 25.2%, twice the growth rate of the total domestic social consumption in the same period; Chinese people's consumption on camera has accounted for 27% of the world's total overseas consumption, ranking first in the world, 10% and 23% higher than Russia and India, which ranked second and third respectively.

"The big difference between domestic and foreign prices of imported goods is the main reason for the existence of purchasing agents," Ren Zhilu said

It was in 2011 that Ren Zhilv officially started to do purchasing on behalf of others. At that time, he was worried because his child was born, but he could not buy cost-effective diapers in China. From this, he thought of the brand Kao that he had heard of when living in Japan, and decided to purchase it on behalf of others.

"According to the exchange rate at that time, if I bought a bag of Kao diapers in Japan, it would cost about 68 yuan, but in China, it would cost about 120 yuan. Moreover, the quality of paper diapers of domestic brands at that time was not comparable to Kao." So he bought five or six boxes at one go. Ren Zhilv's main business is to operate an export-oriented e-commerce trading company, sell Chinese products in overseas markets through e-commerce platforms such as Amazon, and ship them back to China in shipping containers with the convenience of his trading company, "I found that the price difference between China and Japan can reach 30 yuan even including the taxes and fees to be paid for container customs clearance, which makes me think this may be an easy business to do."

Luxury purchasing agents feel that their existence is more meaningful.

"It's not just the price difference. Of course, this is the most important thing. But luxury goods have different distribution strategies in each region, and each store has different buyers to make decisions. So customers also need people like us to help them buy some products that the latter in China said could not be bought in her place." Chen Yizhou, who started to purchase luxury goods in Europe from 2015, said. She has been studying in Germany before, studying fashion Design.

For nearly three years, the number of guests of Chen Yizhou has been stable at about 2000. On holidays, she would return home with two 29 inch suitcases, plus hand luggage, filled with various luxury bags, and sometimes more expensive luxuries such as jewelry and watches.

"Human flesh is still my main means of transportation," she said

Formation of industrial chain

In real life, the social circle is often the first customer group developed by purchasing agents. After that, the growth of the customer group was mainly due to the rise and prosperity of social networks. Accompanied by this is the diversification of purchasing modes - in addition to accepting and meeting demand, it can also create demand. Because the function of mass sending Jiugongge pictures and small videos, whether on Weibo or WeChat, provides the purchasing agents with the opportunity to promote products and communicate more quickly with customers.

Tingzi has already made a purchase in the 1940s. At present, the monthly business flow is between 450000 and 550000, and 700000 when the performance is good. She has opened a physical store offline and hired two assistants. However, it is still an important part of her daily work to make product introductions from her friends. She mainly sells Japanese health care products such as enzymes, anti sugar pills, oral collagen, etc. The unit price is not high, but it is a consumable. Once customers start to eat, they must adhere to it, so the repurchase rate is high, and the reliable volume is profitable.

This product attribute determines that she seldom uses the shipping method of human flesh purchase. Therefore, she now chooses to use international express delivery.

On the one hand, the manpower is limited after all. Even if you have a full budget, you can only take two 29 inch suitcases, a backpack and a carry on luggage, "up to 120 kg in total", and it will consume a lot of physical strength and body. "I once mentioned that my arm was dislocated when I was carrying luggage," Tingzi said.

On the other hand, if there is no declaration and the goods are unpacked by the customs at the airport exit for inspection, a large number of repeatedly purchased goods are also likely to cause the problem of "killing goods" - that is, the goods carried are confiscated by the customs according to law because they have not paid taxes, and even make the goods carriers face prison. In September 2012, a stewardess was sentenced to 11 years' imprisonment and fined 500000 yuan for smuggling ordinary goods because she took advantage of her position to engage in purchasing business and failed to declare for a long time.

As a result, shipping has become a cost-effective option for most purchasing agents, especially when the customer source and orders are stable. When there are many goods, the purchasing agents will consider seeking the help of a qualified import and export trading company or a professional customs clearance company, so that the goods can pass through the customs quickly and smoothly with tax exemption or tax reduction as much as possible.

In case of urgent delivery or force majeure conditions, such as sea ice and suspension of shipping in Russia's purchasing agency, the purchasing agency will choose higher price air transportation, or apportion the goods to acquaintances and friends who can just return home. They will disguise themselves as tourists who bought their own goods, and then bring the goods back to the country.

"Purchasing on behalf of others has become a very mature profession, with its own industrial chain. Human flesh purchasing is very elementary," Ren Zhilu said.

In addition to the logistics restrictions, the primary level of human flesh purchasing is also reflected in the control of the supply of goods. Just like in view of luxury goods Although Chen Yizhou has been an "old agent", he can only go to the store counter to buy, and it is almost impossible to directly establish official contact and cooperation with brands or other upstream suppliers. Their advancement can only be shown in their good relationship with the store guide and making friends, so that they can more easily buy limited editions, or retain some of the best sellers.

"The official attitude of the brand towards purchasing on behalf must be hit," Chen Yizhou's words remind people of LVMH's statement, "but this does not affect our relationship with the shopping guide, we can still help the brand business, brands can not do without our promotion, otherwise how many people will know what products it produces, and we are free advertising."

The stock price fluctuation of some high-end Japanese and Korean specialty beauty brands after China announced the upcoming implementation of the Electronic Commerce Law can more or less support this statement. Soochow CSSD Andrew, Head of Japan Securities Department, Capital Markets Asia Jackson, in an interview with CNBC, warned investors to be cautious in dealing with Japanese beauty brand Pola Orbis)，Fancl， Four stocks including Kose and Shiseido. It is worth mentioning that these four brands are the favorite of the purchasing agents.

In fact, not only luxury goods, but all brands that have counters in high-end department stores or shopping centers, although they cannot do without purchasing agents, are difficult to "officially" accept the existence of such large customers, let alone establish cooperation.

Therefore, the only thing that the purchasing agents can do is to reach a batch purchase agreement with the small beauty shops that sell these products, or directly hire some professional buyers to go to the counter to purchase in batches. It is easy to talk a lot about the cooperation of niche brands. If the communication is good and the order quantity is large enough, you can directly reach supply cooperation with the factory.

Tingzi and Ren Zhilv have established their own upstream chains. Tingzi mainly relies on China and Japan. Ren Zhilu once employed foreign students as part-time purchasing partners in Tokyo. In his heyday, he had more than 20 partners and his own warehouse in Tokyo.

　 Is agent purchase going to disappear?

On April 8, 2016, the new customs policy was implemented. Ren Zhilu regarded this day as a turning point in his purchasing business. He said that it was from that day on that day that he began to seriously consider whether he needed to continue to purchase on behalf of others. Less than a year later, he basically disappeared from the industry.

"One obvious feeling is that business is becoming more and more difficult to do," he gave the most intuitive example with his income. According to his description, the annual after tax income of purchasing agents from 2011 to 2014 can be calculated conservatively to reach 80 million yuan a year, but after 2015, the annual income of this part can only be about 300000 yuan, "and there are many uncontrollable factors, which fluctuate too much."

In addition to the stability of the source of customers, the key factors affecting the income of purchasing agents include exchange rate fluctuations, changes in logistics costs and changes in the source of goods. In particular, the impact of changes in supply can be devastating.

In Ren Zhilu's original business, Japanese diapers and sanitary napkins accounted for a large proportion. However, because Huawang and Tmall reached an authorized cooperation agreement in China in 2015, his financial path was blocked, because it was illegal to continue to do business, and the profit margin was getting smaller and smaller.

　　 Tmall, JD After the formal introduction of overseas brands E-commerce platform Undoubtedly, it increases the pressure on the market survival of the purchasing agents. What's more, in the context of the rapid expansion of the population base, market competition has long been a mixed situation. The living space of real purchasing agents is squeezed to a very small extent by "purchasing agents" who sell genuine and fake goods or sell all fake goods.

"I often see the selling prices of peers, especially those on Taobao. I count all kinds of discounts, together with the credit card discounts of department stores that can be run by local Japanese talents. I don't earn a penny, and I can't report this price. I really wonder how they can get such cheap goods. You have no way to compete with them. There is no advantage. " Tingzi said.

What worries the purchasing agents is that after the industry is scaled up, it will face the test of normalization. Various targeted laws and regulations have been continuously improved, making the cost and risk of purchasing on behalf of others rising. In fact, before the E-Commerce Law and the new customs policy in 2016, 20 had the "No. 56 Document" and other legal and policy documents issued by the General Administration of Customs in 2014, providing a legal basis for the supervision of purchasing groups.

And all kinds of incidental pressure and difficulties come from vaccination. For example, South Korea's second largest airline, Asiana Airlines, previously said that, for security reasons, it would no longer provide "commercial purpose" baggage check-in services for passengers flying to mainland China and Hong Kong from October 22.

"So if I really want to collect taxes, I may not do it. Anyway, I have worked now, and I just wanted to use these things to earn some pocket money." Jennifer, who just graduated from college and entered the workplace, said that she has been working as a Japanese purchasing agent for more than two years. She mainly relies on others to bring goods into the country. She is only responsible for stocking up and selling goods and sending them to her friends' circle. "Now some guests will ask me, but at present, we don't know what will happen."

"I have already told my guests that I will stick to the last minute no matter what," Tingzi said