Originally Posted by
flyinglizard
Many "hopes" from CEO during 1 hour investor recording, the management really does not know Daigou and Chinese customer consuming behaviour, the price war between individual Daigou, retail shops in NZ, Corporate Daigou since 2017/2018. Corporate Daigou is not as important as they used to be. Daigou only work for money and not for A2 brand solely. They will sell hundreds of different products across nations through Corporate Daigou ( many big ones are international logistic companies owned by local Chinese).
Before 2016/2017, everyone went to the supermarket or pharmacy to get the products and manually posted them to China.
After Wechat App developed the payment function. All shops, corporate daigou, and individual daigoy use its online system. The individual daigou does not purchase inventory anymore, instead they contact with shops, Corporate Daigou, or other individual daigous through Wechat to complete a real time purchase within 2 minutes. There are also other technology such as paywaves App between CNY and NZD/AUD used in shops or Corporate Daigou to provide convenient foreign exchange services.
The industry seemed to reach the peak since 2017/2018, lots of shops open, more students and travelers became Daigou. Capital and technology rushed in the sector. The price war started. The margin became less than before. Some daigou retired. Corporate daigou built some big custom bonded warehouse in China and created online platform and its own brand. Retailed daigou got squeezed out the market, because they only deal with relatives, friends or people referred by someone they know.
Now, Chinese people can buy cheap imported products through local supermarkets and shops, where the products are from duty free custom bonded warehouses. The purchasing power from retail daigou is shrinking.
We cannot say Covid -19 hit the daigou market, they still can place order through Wechat and other online systems, the money transaction system still there. The competition among the industry caused more pain to A2 than Covid effect.
However, after more than one year, the ATM management still talking about covid effect, rather than the competition and strategy change.