Respected President Tom Tang, esteemed leaders, dear colleagues, good afternoon! I am Anita Zhou from TOLEAD. Today, I am here to share with you the theme: The Road to $100 Million in 2024.
I remember joining MU Group in the second half of 2021 and officially taking over the TOLEAD team in October 2021. I still recall our first batch of goods arriving in April 2022! Since then, we have embarked on the journey of cross-border e-commerce from scratch. When I received the topic of today’s discussion a few days ago, I wondered what I should share with everyone.
In fact, whether it’s $100 million or $1 billion, the business logic behind both figures is surprisingly similar. Let’s take a look at the following data: As of 2023, the global e-commerce penetration rate has exceeded 20%, and it is estimated to reach 24% by 2026. By 2023, the scale of global e-commerce has reached $6.3 trillion; it is projected to reach $8.1 trillion by 2026. According to official statistics, by the end of 2023, China had over 100,000 cross-border e-commerce entities! The trend has long been underway.
I still vividly remember my first meeting with President Tom Tang at a tea house. After reviewing my resume, he said to me, “If you join us, you can choose to do traditional foreign trade or cross-border e-commerce.” Because I have over ten years of experience in traditional foreign trade, I pondered for a moment and replied, “I’ll stick with cross-border e-commerce.” Although cross-border e-commerce involves long chains, multiple links, significant changes, and high risks, it yields quick results! I believe that if I had chosen traditional foreign trade at that time, I might have survived, but in just over two years, I wouldn’t have achieved the current revenue scale. So, when the trend comes, will you choose to go with the flow and become its ally?
Going with the trend makes your efforts more effective, as the trend will be your strongest ally. Don’t misunderstand; I’m not advocating for everyone to transition to cross-border e-commerce. In fact, we shouldn’t narrow our understanding of trends. The term is very broad! It can be an industry, a product, a technology, or even something as small as a trendy element. If you’re in the clothing business, you might pay close attention to the popular styles and colors each season.
For example, in the field of cross-border e-commerce, there’s a company called ZIEL that started with indoor furniture. It’s now listed, and many years ago, it introduced a board with a fire cloud pattern. This fire cloud pattern set the industrial trend on Amazon and influenced the trend of indoor furniture. Sellers who followed this trend made significant profits! Even today, many new sellers still choose boards with this fire cloud pattern.
So, what if we go against the trend? The trend will be your strongest opponent! Sometimes I wonder, is it really our friendly competitors who snatch our business and orders? Is it really our peers? Is it really our competitors? Perhaps it’s the trend. So, did Douyin snatch Taobao’s business?
Of course, identifying trends in the early stages is extremely difficult and uncertain. I have two living examples around me. I have an engineer friend who specializes in lighting fixtures. Many years ago, when LEDs were just emerging, he told me, “Anita, it seems like LEDs are becoming popular now, but do you know? LEDs emit blue light!” As you may know, when you go to an eyeglass store to get glasses, the salesperson will ask you, “Hey, do you want to choose lenses that protect against blue light? Because blue light is harmful to our eyes.” Additionally, LED lighting fixtures generate environmental pollution when discarded. Although they’re not as environmentally friendly, they are highly energy-efficient, have long lifespans, low voltage, are safer, and offer richer colors, making them suitable for a wide range of applications.
Now, can you still say that LED is not a trend? Looking at the lighting fixtures in our homes and offices, many have quietly become LED lights.
Another example: We know that there is a listed company in Ningbo, Loctek, which used to engage in traditional foreign trade but later transitioned to cross-border e-commerce and is now expanding into the overseas warehouse market. Many years ago, when he was in this field, liquid crystal televisions were not yet popular. A friend of mine, his relative moved to the house, he gave him an LCD TV as a housewarming gift. I remember him saying to me at the time, “Look, a LCD TV costs tens of thousands of yuan!” When will it replace CRT TVs? How high will its penetration rate be? As an accessory, how many TV brackets can be sold on the global market? But today, we see LCD TVs in every household, and almost every room has one!
The next topic I want to share with everyone is that any advantages or disadvantages are dynamic and even transformative. I think the word “dynamic” is very important. Whether it’s cross-border e-commerce or traditional foreign trade, we need to consider the dimension of “time”. I remember when I first chose to join MU, my friends were very surprised. They would wonder why I chose to do cross-border e-commerce at MU because her advantage lies in traditional foreign trade. If we engage in cross-border e-commerce, we have no first-mover advantage, starting late, no accumulated experience, and no scale advantage. Overseas warehouses, first-mile logistics, and supply chain costs are all expensive, and there are no service provider resources. Additionally, it was the second half of 2021, and the market environment was relatively bleak. Many cross-border e-commerce companies closed down and laid off employees because first-mile logistics costs soared. At that time, freight forwarders were all making a fortune, earning several years’ worth of money in just one year: the party of the second part had become the father of the first part. A very close friend of mine said to me, “Anita, do you think you’re out of your mind? Do you think you can start afresh as a leading cross-border e-commerce enterprise? Don’t forget that you’ve wasted your skills and spent two years before starting again!”
But in my opinion, any disadvantage can be transformed or even changed through several points: money, suitable people, and time. So, the first time I met with Tom Tang in a teahouse, I didn’t ask him how much bonus I could get by joining MU or what the commission rate was. I asked him a question: “Tom, how determined are you to do cross-border e-commerce?” His answer remains vivid in my memory to this day. He said, “I can invest one billion!” I know he is very wealthy, but he also added that it would take several years of such investment, not just one billion in the first year.
So you see, “determination” is synonymous with “time”. When you are opening up a new sector, you will inevitably encounter many setbacks. If you don’t have a firm determination and give up at the slightest setback, where does the time come from?
Looking back on my two and a half years of hard work at MU, I feel it was quite arduous. Many times, when encountering minor setbacks or making some progress, I would think of a mentor who guided me onto the path of cross-border e-commerce. He gave me opportunities and allowed me to grow – he is Chairman Wu, the president of Hooya Group. Every time I think of him, I am filled with gratitude. What I didn’t expect was that Tom Tang also expressed his gratitude to him. I am also very grateful for Tom’s recognition of my work. I will turn this recognition and encouragement into my driving force for advancement and strive for greater progress!
Next, I would like to discuss: focusing on the essence of business! In the movie “The Godfather”, there is a line: “Those who can see the essence of things at a glance and those who spend their whole lives unable to see the essence of things are destined for completely different fates.” In fact, in cross-border e-commerce, many sellers’ approach is to sell whatever others sell well. However, what I want to say is that we should not only see the surface but also understand the underlying business logic and essence.
Starting from the product, it may be price, timeliness, and customer experience. Customer experience includes appearance, functionality, quality, service, and reach. Whether it is traditional foreign trade or cross-border e-commerce, you need to communicate information to your customers.
From a market perspective, it’s about demand and supply. When teaching at the Advanced Training Course of MU Academy, many classmates asked, “Why is Pinduoduo’s momentum so strong?” In fact, think about it, how did Pinduoduo come about? At that time, WeChat had 1 billion monthly active users, but Taobao only had 600 million. The difference of those 400 million users was the lower-tier cities. Moreover, as the number of monthly active users of the Taobao ecosystem increased, the advertising threshold for the platform also increased. Many new sellers complained that they couldn’t get in and couldn’t afford it. Therefore, Pinduoduo emerged, meeting this demand with supply. So now we can see that Pinduoduo’s momentum is very good. Pinduoduo’s strategy of surrounding cities with rural areas is quite successful, and it has also gone abroad.
TOLEAD have always focused on the field of cross-border export e-commerce, guided by market trends and demands, with supply chain and products as advantages, adhering to refined operations and opening up diversified sales channels. Because the market is becoming more and more saturated, if the supply chain is not strong, efficiency is not improved, and products are not strong, your life-cycle will be very short.
Previously, a more extensive operation might have been okay, but now, if you don’t operate with precision, where does your profit come from? Currently, whether domestic or foreign, the pattern of one e-commerce giant ruling the roost has been broken. So, if you now only hold firmly to one platform, your risk is very high, and sales growth will be relatively slow. Therefore, we need to open up diversified sales channels.
We know that it took 3.5 billion years from single-celled organisms to humans, tens of thousands of years from the Stone Age to the agricultural age, thousands of years from the agricultural age to the industrial age, over 200 years from the industrial age to the information age, decades from the information age to the AI age, and less than a year from ChatGPT to Sora. The pace of world development is such, and so is the pace of industry development! The later stages of the industry, the more difficult it is to enter and survive. So I say, the acceleration of industry growth is increasing!
When you enter the industry early on, it’s like elementary arithmetic. When you enter later, it’s like advanced calculus. So if you enter this industry late, do you have no chance? No, opportunities always exist. Because even so, the emergence of new things means there is a new starting line. For example, after Tik Tok came out, it was definitely good news for some new sellers. Of course, we’re not saying that these new sellers, the newcomers, are on the same starting line as the old Amazon sellers. That’s impossible! Because many of their products have already gone overseas, they have a scale advantage, and applying for a Tik Tok store is also easy. In fact, it just shortens the distance of this starting line, but shortening it is also very good news, right?
In the face of such a world, how should we respond? You might think it’s a hackneyed topic, but I think we still need to have a vigorous curiosity, keen observation, and continuous learning ability. When I was in my thirties, I understood Wang Yangming’s phrase “knowledge and action as one”. I thought: knowledge is not easy, but action is even harder. But when I was in my forties, I finally understood that “knowledge and action” are actually “one”. If you truly understand something, you will definitely put it into practice! Some of my friends around me, whether in the field of traditional foreign trade or cross-border e-commerce, some operators, are over fifty years old, but they all have these three qualities. So, even in this fiercely competitive battlefield full of young people, they can still overcome obstacles and ride the waves!
Below, I’ll talk about embracing competition, which drives development. In fact, we just had a very exciting debate, and everyone saw this topic from both sides. I want to say: Regarding competition, if you don’t embrace it, it will come from behind and grab you by the neck, isn’t that right? So, competition is relentless. If you’re a business owner, would you let your internal divisions compete internally? If you’re a market creator, would you let players in the market compete? I believe the answer is: YES! It’s just that in doing so, you will regulate the market more and establish fairer rules of the game.
The unknown canvas of life unfolds slowly every morning when you open your eyes, and each of us is an explorer on our own life journey. Let me share a saying I really like: Life is meant to be burned, not oxidized. Let’s invest our limited lives into infinite endeavors!
Salute to every member of TOLEAD, salute to every day and night of hard work. Thank you all!
(This article is compiled from the recording shared by Anita Zhou, General Manager of TOLEAD, at the 2023-2024 Middle and Senior-Level Cadres Meeting of MU Group)