Market dons 'new suit' to attract customers

Updated 2016-12-27 11:13:54 Shanghai Daily

The annual year-end clearance sale at the Hangzhou Evergreen Garment Wholesale Market begins this week. The event offers all merchandise at discount prices, attracting big crowds of bargain-hunters.

The market, one of China's largest wholesale venues, houses between 12,000 and 15,000 shops, offering everything from buttons to fine linen and cashmere clothing.

But this is not the end of an ordinary year for the market. Trading volumes have dropped 30 percent from 2015 because of the overall economic downturn, the first decline in the venue's 27-year history. In addition, Evergreen Market is also facing competition from online vendors and a space squeeze from expanding residential construction in the area.

The market opened in 1989 with only 45 outlets. Evergreen Garment Group Vice President Ni Shuiquan said no one anticipated at the time that the venue would grow to its present size.

It has weathered the changing fortunes of the rag trade, including the shift to global e-commerce and slower economic growth in China.

"The prosperity of e-commerce has been a big blow to this traditional market," Ni said. "Many factories have opened online stores to go with the trend. They attract wholesalers but tend to skip brick-and-mortar markets like us."

Indeed, customers can now easily compare prices at the market with merchandise offered online.

In order to rejuvenate the market, Evergreen has invited factories to open outlets in the market, narrowing the gap between online and offline prices.

It's a tough proposition to transfer the price advantage of business-to-business wholesale transactions to business-to-consumer retail selling.

"The business-to-consumer model requires attention to online customers, which isn't the case so much in the wholesale business," said Yu Yuqing, who runs a women's apparel shop in Evergreen. "We had to shut our online shop after four months because of the operational demands."

Some shops have hired university students versant with Internet use to handle online orders. Other shops simply supply products to e-retailers on the Alibaba online platform Taobao.

"Now, online platforms link with factory-gate products through our market," Ni told Shanghai Daily. "In addition to brick-and-mortar shops, online stores add a new channel for product distribution."

Modern logistics is an indispensable part of the e-commerce business. Merchandise ordered online needs to be delivered fast and efficiently. Evergreen is building logistics hubs in over 10 cities, with sites in Xi'an, Qingdao, Yinchuan and Tianjin already up and running.

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