Hong Kong’s ‘Daigou’ Trade Is Back. But This Time, It Has Reversed.

For years, Shenzhen resident Elaine Kong earned money by shuttling items from Hong Kong into the Chinese mainland. Each weekend, she would cross the border and purchase up dog crates of baby formula, Lancôme eye cream, and other items that were costly or tough to discover on the mainland, and after that offer them on at a revenue after returning house. Now, as China lastly relieves travel constraints after 3 years of rigorous pandemic controls, Kong is making routine journeys throughout the Hong Kong border as soon as again. This time, she is bring items in the opposite instructions. For the previous couple of weeks, the 30-year-old has actually been purchasing fashionable treats and bubble tea in Shenzhen, and after that providing them to customers in Hong Kong. The need from Hong Kongers and mainland trainees in the city has actually been impressive, Kong states. She has actually currently made lots of journeys and turned over more than 100 products. “In the past, I purchased things from Hong Kong for mainlanders and earned money from that,” Kong informed Sixth Tone. “It’s amusing how I’m now doing it the other method around.” Lots of Chinese expert buyers, or daigou, have actually gotten on this very same pattern considering that the Hong Kong border resumed in early 2023. Shuttling products from Shenzhen into Hong Kong has actually ended up being so typical, the expression “reverse daigou” has actually ended up being a buzzword– and a sign of just how much has actually altered given that the COVID-19 pandemic very first emerged. Prior to 2020, the daigou trade was a huge market in China. Around 1 million Chinese were stated to be used as daigou, who mostly earned money by bringing foreign items into China. Sometimes, daigou assisted mainlanders prevent high import taxes on high-end products. Other times, they assisted them gain access to items that weren’t offered in mainland shops, such as specific foreign cosmetics or child formula. Chinese authorities passed a law to stymie this gray market in 2019, yet the daigou trade continued to grow. The daigou market produced $40 billion that year, according to one price quote. Came COVID. As nations around the globe enforced travel restrictions, shuttered mall, and canceled global flights, the daigou trade entered into a deep freeze. It’s far more hard to do now than prior to the pandemic … The border checks have actually ended up being much more stringent. – Yang, Shenzhen-based “daigou” The market has actually never ever recuperated. With China maintaining travel limitations for 3 years, mainland customers discovered other methods to source overseas items. A growing number of global and Hong Kong brand names have actually established shops on Chinese e-commerce platforms Tmall and JD.com. The tighter border checks that China presented throughout the pandemic have actually stayed in location. When Hong Kong totally unwinded travel constraints in February, daigou discovered that their previous organization was no longer practical. “It’s a lot more challenging to do now than prior to the pandemic,” a Shenzhen-based daigou, surnamed Yang, informed Sixth Tone. “The orders have actually dropped, and the border checks have actually ended up being much more stringent.” Up until 2020, Yang earned a living by purchasing up cosmetic items in Hong Kong to offer to consumers on the mainland. It was typically possible to bring products throughout the border undetected, permitting her to prevent paying costly tasks. Now, she has to open her bags for assessment practically every time she crosses the border, Yang stated, and state the worth of the items she was bring. People are just permitted to bring 5,000 yuan ($ 730) of products into the mainland every 2 weeks. It’s difficult to make a good living by carrying such a little volume, according to Yang. “For products worth 5,000 yuan, I can just make around 600 yuan,” she stated. Kong provides treats from Shenzhen to clients in Hong Kong. Thanks To Elaine Kong For this factor, numerous Chinese are beginning to check out the “reverse daigou” trade. Considering that late February, numerous reverse daigou advertisements have actually been published on social platforms consisting of Facebook and Xiaohongshu. They seem bring in a lot of consumers. There are a big range of fashionable treats in mainland China– referred to as wanghong meishi, or “viral food”– that are difficult to discover throughout the border in Hong Kong. Bubble tea from Yidiandian, Master Bao’s pastries, and specialized items from Alibaba’s Hema grocery stores or Walmart’s Sam’s Club shops are all apparently popular options for reverse daigou. The handover typically happens at a station along the Hong Kong city’s East Rail Line, which ranges from the border to Hong Kong Island, so the daigou do not need to leave the city and spend for an additional ticket. The earnings margin for these reverse daigou shipment is little: Customers frequently pay simply 15 yuan per bubble tea shipment, 3 daigou associated with the trade informed Sixth Tone. The daigou state it likewise has a number of benefits compared with their previous service. The daigou can make usage of the quick and super-cheap shipment services on the mainland. Whenever a customer in Hong Kong makes an order, the daigou can rapidly get the treat provided to their houses in Shenzhen. This implies they no longer need to range from one shop to another, as they did when they were purchasing up items in Hong Kong. Second, daigou no longer need to make big in advance purchases of items. Now, the customers put the order and spend for the shipment ahead of time. “When I utilized to daigou Hong Kong items to mainlanders, I as soon as mistakenly purchased a phony item and lost a great deal of cash,” Kong stated. “Reverse daigou does not need bearing threats like that.” Third, it is far much easier to bring things from Shenzhen into Hong Kong than the other method around. Hong Kong limits food imports, the border evaluations are extremely lax, Kong stated. Kong now works 5 hours a day providing treats, making around 300 yuan. She considers it the ideal task for her at the minute, as she has 2 young kids and does not have time to work a full-time task. “I wish to attempt my finest to see how far I can go, and whether I can enhance the logistics and do it much better,” she stated. She has actually currently created a couple of techniques to conserve her energy and time. She utilizes the real-time place sharing function on WeChat, a Chinese social app, to offer her customers a concept when she will get here at the station. Kong is likewise considering establishing a WeChat mini-program to collaborate orders, payments, and shipment, much like some Chinese start-ups did to arrange group-buying networks throughout the lockdowns of 2022. She is likewise fretted that if the reverse daigou organization ends up being too huge and formalized, it might produce intricate legal problems that will consume into her revenues. “I make sure making a platform suitable for both systems in Hong Kong and the Chinese mainland is extremely hard,” Kong stated. “The daigou market pays specifically since it bypasses all these problems.” Editor: Dominic Morgan. (Header image: A group of females posture for a picture outside Luohu Port in Shenzhen, Guangdong province, Feb. 12, 2023. Shi Yan/IC) intake web