Editor’s note: With online sales in the region projected to hit US$88 billion within a decade, a Hong Kong logistics startup has jumped on the bandwagon, offering packaged shipping services to local consumers who turn to overseas e-commerce platforms to satisfy their needs.
(BILLY WONG / CHINA DAILY)
The insatiable appetite of savvy Hong Kong consumers seems to have spilled out of the “shopping paradise” in recent years, with a growing number of them turning to overseas sites for more or better options.
Hong Kong-based logistics startup Buyandship hopes to facilitate the process with its international shipping service, helping shoppers to buy from platforms that don’t normally ship products to Hong Kong.
When shopping on an overseas site, a consumer can have the bought items shipped to a domestic Buyandship warehouse, where the startup will forward them to the consumer’s doorstep.
We see ourselves as an important component of cross-border e-commerce, unifying world prices, and thus we got Buyandship off the ground
Sheldon Li, co-founder of Hong Kong-based logistics startup Buyandship
If a purchaser buys from multiple platforms in different countries, he or she can choose to wait for all the items to arrive at the same location, and receive everything in one package.
A heavy user of global shipping services himself, Buyandship co-founder Sheldon Li fully understands the hassles involving existing service providers, especially with regard to payment and logistics.
He believed the scenario presented him an opportunity to “disrupt” the market, and offered a mature logistics solution with a simple, fixed pricing system.
“We see ourselves as an important component of cross-border e-commerce, unifying world prices, and thus we got Buyandship off the ground,” he explains.
Li teamed up with Wilson Chan, who’s now the company’s chief executive officer, setting up Buyandship four years ago.
With the help of Li’s family, which has been in the courier business for more than three decades, the logistics system was up and about when the company started. The company now owns warehouses in the United States and Japan — two major sources for its users — and has secured exclusive partnerships with warehouse operators in the United Kingdom, South Korea and on the Chinese mainland.
Li recalls his challenge back then was to educate the market that was not familiar with the idea of shopping and shipping from abroad.
The startup went the extra mile in reaching out to users on social networks, providing shopping tips and up-to-date information on major sales campaigns by Hong Kong consumers’ favorite brands.
To date, the company boasts more than 90,000 members.
Hong Kong online shoppers buying from overseas sites have a strong preference for quality products rather than cheaper options, and when they do make a purchase, they buy a lot, the company observes by studying their shopping patterns.
Yet, they’re more price sensitive with their freight. Over 90 percent of them choose to pick up their packages at a redemption point, which costs less than having them delivered to their doorstep, according to Li and Chan.
Hong Kong’s exemplary brick-and-mortar retail scene and high logistics costs may have nurtured a sense of apathy for online shopping among local consumers. But, such sentiment is likely to be on the way out.
According to a 2017 research by payment company MasterCard, about 88 percent of Hong Kong consumers surveyed had shopped online in the past three months, posting 3.8-percent growth over 2015.
The SAR’s e-commerce figures, however, have lagged behind those of key markets in the region, like South Korea, India, Japan, Vietnam and the Chinese mainland, where more than 90 percent of consumers had made online purchases recently.
However, Hong Kong’s online shoppers are more likely to shop on an overseas site than other markets.
A 2015 research by US courier FedEx revealed that around 86 percent of online shoppers in Hong Kong had bought goods once from a foreign e-retailer each year, posting a substantially higher ratio than the Asia Pacific and world average of 72 percent and 69 percent, respectively.
Buyandship is also exploring the booming e-commerce markets in Southeast Asia. It has already started operations in Singapore, a market it considers very similar to Hong Kong’s, and aims to take on new markets, including Malaysia and Indonesia.
Southeast Asia will be the “next frontier” for further development in the e-commerce sector, according to Marc Woo, industry head of Google Malaysia.
In the business-to-consumer sector, the Asia-Pacific region accounted for 40 percent of global e-commerce sales in the first quarter of this year, he said.
E-commerce sales in the region will grow from US$5.5 billion in 2015 to US$88 billion by 2025 at an annual rate of 32 percent, says a research report by Google and Singaporean sovereign fund Temasek Holdings.
Banking on the opportunity, Chan hopes to take Hong Kong brands to the flourishing Southeast Asian market.
“A lot of quality Hong brands, big or small, don’t really have e-commerce ready for the Asia-Pacific region, and they see us as a tool as well to reach the Southeast Asian market. It shows we have the ability to give their brands more legitimacy in these markets,” he says.