The summer solstice is not far away. For cross-border export e-commerce companies, July to September is the worst season of sales in a year, and February to April is the second slowest season. As a B2B platform for cross-border e-commerce, Dunhuang net achieved a reverse sales in the off-season of March and April through a series of member feedback activities, which is a spring breeze for small and medium-sized foreign trade enterprises on the platform.
However, small and medium-sized foreign trade enterprises are still plagued by problems such as capital turnover, more disputes between buyers and sellers, hidden dangers in payment settlement, and less flow. Dunhuang network, which is tailored for small and medium-sized foreign trade enterprises and has been deeply ploughed in cross-border export e-commerce industry for many years, seems to have not removed the pain of small and medium-sized enterprises in the process of foreign trade.
Did not resolve the pain point one: small and medium-sized enterprises capital turnover problem
Strong capital turnover capacity is the necessary guarantee for enterprises to operate for a long time. For the sellers of small and medium-sized enterprises on Dunhuang network, capital turnover is naturally particularly important, which can be described as one of the lifeblood of their production and operation. The payment cycle of buyers is long, which will affect the circulation of small and medium-sized enterprises lacking in cash flow.
If the seller sends out the goods, the buyer does not settle payment for some reason. And the seller has a new order at this time, but because of insufficient funds to produce the next batch of products or stock, can only give up the new order. But if the buyer’s payment cycle is short, the seller can quickly start production or stock up for the next order.
On the one hand, most of the enterprises in Dunhuang net are small and medium-sized, and the orders are mainly small orders, but even small orders have as little as several thousand dollars, as many as two or three hundred thousand dollars. Once the buyer delays the payment cycle, the order money will be a large number for the seller.
On the other hand, logistics cycle is also an important factor affecting the settlement time. Generally speaking, it takes about 15-30 days from buyer placing order to platform lending after signing for receipt, which is not short in itself. If logistics delivery is longer, the transaction cycle will be extended again, which is not conducive to sellers producing small and high-frequency transactions in a short term.
There are a variety of logistics options for sellers on Dunhuang, including the four major commercial express and third-party logistics platforms such as SF Express, the self-owned logistics system provided by Dunhuang, and other logistics companies. Most sellers choose China Post, HongKong Post and other postal parcels to send, which are cheap and convenient for customs clearance. However, postal parcels are slow in delivery time, have a high rate of packet loss, and cannot be tracked for non-registered parcels. The delivery period for small packages is usually 15 to 30 days, but online data shows that almost 80 percent of cross-border packages are delivered within 30 days.
In addition, when the seller is completely delivered, in the buyer has not been confirmed to sign, and the seller is confirmed in the order after receiving 90 days also did not ask the case below, Dunhuang net can be in the seller completely delivered 120 days after the day will automatically lend money. Moreover, when the seller’s online shop dispute rate to a certain extent will suffer 20, 45, 180 days and other different days of extended loan cycle. It can be seen that in B2B cross-border trade, the long settlement period is a great disadvantage.
Obviously, how to improve the trading cycle of buyers and sellers, help small and medium-sized enterprises to shorten the payment cycle, enrich the cash flow, can quickly realize the capital turnover to the next order, become a dunhuang network must act. For example, strengthen the review rate, shorten the loan cycle, provide reliable small loan services for sellers with high credit to ease the seller’s capital turnover problem.
Did not resolve the pain point two: credit system is not perfect
Business pays attention to the good faith of both the buyer and the seller. Both the buyer and the seller can cooperate happily and long only on the basis of mutual trust. Cross-border e-commerce platforms are no exception. Only by ensuring that both buyers and sellers are honest and trustworthy can the platform win the trust of both sides and gain a good reputation. However, The review mechanism of The buyers and sellers of Dunhuang seems to be not perfect, especially the review of buyers.
The seller in Dunhuang net registration requires identity verification, submission of personal enterprises and other relevant materials, the general review time is one working day, after successful registration to upload the product, the review cycle is 3-7 working days, from the seller’s registration process there is not too much wrong. And buyer registration does not seem to have what condition limit, even audit mechanism and so on. The uneven verification mechanism for the registration of buyers and sellers gives those who want to fish in troubled waters an opportunity to take advantage.
Due to the defects of dunhuang credit system, there are many disputes between buyers and sellers, and there are hidden security risks in the settlement method. On the one hand, the amount of cross-border trade involves factors such as different countries, regions, currency exchange rates, payment methods of foreign buyers, complicated and long transaction process, etc., so the settlement method is not limited to the platform. According to reports, Dunhuang offers buyers more than 30 payment methods, which have hidden security concerns.
On the other hand, foreign buyers mostly use credit cards to pay, and the rate of credit card dishonor is high. Within 180 days of receiving a credit card statement, the buyer may file a refusal to pay if he or she disputes any of the transactions on the statement, or even if the buyer refuses in bad faith.
Statistics from the International Credit Card Organization show that the dishonor rate of credit card consumption is less than 0.5%. In the list of fraudulent and non-fraudulent dishonor rates of credit cards of domestic payment companies and e-commerce companies compiled by third-party payment platform Yibao Pay, the fraudulent dishonor rate of Dunhuang is 0.8%, and the non-fraudulent dishonor rate is 0.5%, which exceeds the international average. Malicious dishonor is the buyer’s integrity problem, and dishonor due to commodity problems is the seller’s lack of integrity. The dishonor rate of Dunhuang is basically higher than the international average line, which also reflects that there are still some defects in merchant certification and commodity certification, which can not fully and effectively protect the interests of both buyers and sellers.
There are a lot of swindlers in Dunhuang net registered as buyers, bypass the platform risk control mechanism, and even use the shortcomings of the platform, through a variety of ways to defraud the seller of money. If there is a swindler after placing an order, the seller is eager to collect money, save the handling fee and other psychology through offline payment to defraud the seller of money; Fraudsters place orders through other ways to contact the seller to let it change the delivery address, and then the credit card complaints for refund, the seller can only watch the money and goods lost because of the lack of evidence.
If the con party pretend to be a buyer to defraud the seller mailbox, and then pretend to be a customer service in the form of deposit to defraud the seller of money. It is the time when dunhuang’s customer service is difficult to contact that the fraudsters mainly commit crimes against novice sellers. However, Dunhuang claims that the platform’s customer service is 7X24 hours. It seems that this is not the case, and the platform’s customer service system remains to be improved.
Although the platform is not directly responsible for these scams, the reason why sellers suffer from all kinds of scams is also caused by the platform’s incomplete credit system, lack of risk control system, and some unprofessional services on the platform. If the platform has a more convenient payment method, a widely recognized and popular payment brand like PayPal, and a careful verification of the qualifications of both the buyer and the seller, the fraudsters who want to exploit the loopholes can be kept out of the market and the sellers on the platform can avoid such financial losses.
Unresolved pain point three: flow ceiling within reach
The mechanism of Dunhuang for both buyers and sellers is different from aliExpress and other modes. Both buyers and sellers can register for free without having to pay annual fees or store fees. Instead, they only charge buyers a percentage when the transaction is successful. The model seems to be popular with users because it saves both buyers and sellers a lot of extra costs, but there are some problems with every upside.
On the one hand, the platform needs to pay labor costs, platform development and maintenance costs and other necessary costs, while the platform provides the buyer and seller free of charge and only takes a percentage when the transaction is successful, which will make its profit limited. If the successful transaction rate is low, the platform will find it difficult to balance its income and loss, making it difficult to continue.
On the other hand, dunhuang offers very little traffic to sellers, making it a far cry from Amazon, eBay and AliExpress, which is backed by Alibaba. By the way to the island’s profit is limited, in addition to trading success as also through some offline activities, give the seller some security service, marketing activities, such as some membership fee, so flat to Taipei to sellers to attract more traffic requires greater costs, and profit limited circumstances make it difficult in terms of traffic.
According to online data, AliExpress has a PV value of 666 million yuan, an IP value of 66.6 million yuan, and a transaction volume of about 10 billion yuan
As we all know, the greater the flow of the platform can bring more customers for the seller, the higher the achievement rate, the more sellers of the platform need more flow naturally, otherwise how to take into account the more than 1.7 million sellers on Dunhuang net profit benefits and protect its more than 7.7 million products can get flow?
In general, Dunhuang, which has been deeply engaged in cross-border e-commerce B2B for 14 years, has achieved good results in the cross-border export industry by exempting buyers from annual fees and only charging part of the commission fee when the transaction is successful, and opening it to sellers for free. However, it has not fulfilled its original intention of benefiting small and medium-sized foreign trade enterprises.
Also because of its income mainly comes from the charge after the order to clinch a deal the buyer make its profit model single plight, hard to bring the seller traffic, more tend to safeguard the rights and interests of the buyer, the seller’s rights is better than a few minutes less tendency, leading to the platform sellers in cycle long cases in a cash flow problem, However, the multi-category payment method and some deficiencies of the platform side make sellers face potential security risks.
Therefore, in the future, Dunhuang should return to its original intention to protect the rights and interests of buyers as well as sellers, so as to win a better reputation on both sides and go further in the cross-border export e-commerce industry.
Article/Liu Kuang public account, ID: Liukuang110