Online is new route to China for Irish exporters

China's online grocery market could be worth US $180 billion by 2020.

A host of opportunities in China has opened up for Irish food and beverage suppliers, via the online shopping route.

According to Guy Wingfield-Horan, Food & Beverages Division, Bord Bia, China is both the world’s largest grocery market (US $1.1 trillion in 2015) and the world’s largest online retail market (US $ 630 billion in 2015).

Chinese consumers are increasingly buying their food online.

The country’s online grocery market could be worth US $180 billion by 2020.

Cross Border E-Commerce (CBEC) allows Chinese consumers to purchase products online from international suppliers, and have them delivered directly to their doors.

Certain import hubs are allowed handle packages and can waive import duty taxes on individual purchases.

And VAT and consumption taxes on CBEC imports are reduced by 30%.

Therefore, the CBEC model is a new route-to-market for Irish exporters, but also allows a different profit margin, due to the reduced taxation on CBEC sales.

“While there are opportunities with the CBEC model, it requires careful consideration and study in advance in order to discern if the model is right for your product, your brand, and your business,” advised Mr Wingfield-Horan.

Some 50% of China’s 400 million e-commerce shoppers are already buying through the CBEC model.

This has prompted Chinese online retailers to invest in cold-chain logistics, to facilitate import of perishable products through CBEC.


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