How Chinese Sellers are Winning the Race on Amazon (pt3)


Davide joins us for part 3 of How Chinese Sellers are Winning.

Access to Cash

  • Amazon is a cashflow business and many Western sellers cannot get the money to expand product lines this helps why Chinese sellers are winning
  • Chinese Sellers lose as much money to run lots of trials and test to get speed
  • Lose money as much time as they can because they will beat the competition using their get sh*t done ethos
  • USD$50bn invested in 2018, we don’t see these numbers in Europe
  • Invest to spend and make the mistakes to approach the market in the right way

Amazon is a hot property

  • Not all of the Chinese Amazon sellers have access to lots of money
  • Many Chinese investors are looking to provide money into Amazon Sellers as it’s a hot topic and can give a return right now
  • And they will invest in a 26yr old with 2 years experience in a big Chinese seller on Amazon who goes out on his own

Deep Pockets

  • A Chinese Seller found that a competitor had opened up in his market with the same product but cheaper – turned out it was the owner of his Chinese supplier factory!
  • Chinese sellers will undercut and lose money to push you out of the market with deeper pockets

Black Hat – Risk Tolerance

  • Not all Chinese sellers go the black hat route
  • But those that do Black Hat don’t see it as a ‘black hat’ issue – it’s just doing business
  • Getting there faster through taking shortcuts means more risk taking
  • Breaking the rules a little bit is seen as okay and contributes to why Chinese sellers are winning
  • But once one breaks the rules it creates a vicious circle of everyone doing it
  • Not seen as a risk because lots of sellers are doing it
  • There are special courses in black hat tricks for 2,000-4,000 USD
  • They market the course by saying you are stupid if you’re not doing these things as everyone else is
  • It’s driven by reducing speed to market and getting the sales

Culture

  • Don’t see the risk as not living in US or Europe – so even getting caught is not a big problem
  • They’re not working on building a brand so much so less risk

Self-improvement

  • Typical working week of a Chinese account manager is very different to Western
  • Want to learn as quick as they can – so they go 7 days
  • Western account managers take the weekend off and finish 6pm on Friday (in Spain 2pm)
  • Chinese people can be requested to work on Sat and Sun as it’s legal
  • 44hrs Max in China, some in Europe are 36hrs
  • So Chinese are constantly studying and improving themselves
  • Attend a lot of training, meetups and workshops
  • Saturday or Sunday are the only days you can run training as they don’t want to lose a working day in Mon-Fri
  • They expect to one day run their own business and so want to know how everything works end to end
  • Normal to constantly learn, share articles, chat on weekends about work, and improve
  • Cultural push to focus and be number one in China

Summary

  • The level of competition and lengths that Chinese sellers will go
  • Access to money
  • Like to get sh*t done
  • Competitive on pricing
  • “Hard work beats talent when talent doesn’t work hard”
  • We live in a world where there is competition

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