This article is from WeChat public account: Fly Book Interactive (ID: meetsocial)
First, let’s see how the epidemic affects the supply chain and logistics and poses a serious challenge to sellers:
I. Overview of New Crown Epidemic Situation
On February 11, Zhong Nanshan, an academician of the Chinese Academy of Engineering, said in an interview with Reuters that the peak of the epidemic is expected to arrive in mid-late February, and there will be a transition period similar to that of small platforms. It is hoped that the epidemic will end before April. We also noticed that many experts from various places said that the inflection point of the epidemic had not yet reached, and prevention and control could not be relaxed.
The real-time epidemic data updated as of the morning of February 14th. In addition to the surge in the number of confirmed cases in Hubei on the 13th due to changes in diagnostic standards, the number of newly confirmed cases and suspected cases nationwide increased.Similar cases have shown a continuous downward trend for many days, and the trend of epidemic prevention and control is improving. However, as the number of potential risk groups (ie, close contacts who are still in medical observation) is still high, before the close observation is lifted, these people There is always the possibility of becoming a suspected or confirmed case, and the pressure on epidemic prevention and control is still high.
(Data source: Baidu epidemic real-time big data report)
According to experts’ suggestions, we expect that areas with relatively stable epidemics will gradually resume work. However, considering factors such as worker tide and the gathering of people after the start of work, the pressure for epidemic prevention and control is still high, especially in provinces and cities with a large inflow of reworkers In addition, the epidemic situation in Hubei Province remains uncertain. Therefore, labor shortage in the short term is still a huge difficulty for enterprises to face when they resume work.
Second, the impact on the consumer end of cross-border e-commerce
Will the impact of the epidemic affect the purchasing behavior of overseas consumers? This should be a question that many cross-border e-commerce sellers want to be answered. Feishu Shennuo’s analysis of the back-end database (The data includes data from the two Spring Festivals in 2018 and 2019, and also includes data before and after the outbreak) , analyzes the data source, and integrates the marketing performance of Feishu Shennuo customers on mainstream media such as Facebook, Google and other cross-border marketing. From the marketing investment, ( Spend) , user clicks (CTR) , and purchase conversions (CVR) Three dimensions provide insights into changes in consumer behavior during the epidemic.
1. From the perspective of marketing investment (Spend)
From Q4 2019 to the Spring Festival, the overall overseas marketing investment trend of the e-commerce industry is basically consistent with the same period of last year, but the outbreak after the Spring Festival has obviously affected the improvement of marketing investment data.
2. From the data of the user clicking on the CTR, see
The overall trend remains stable, even after the Spring Festival in 2020, there is an upward trend, to a certain extent, indicating that overseas consumers are not less interested in marketing products.
3. Judging from the CVR data of the purchase conversion of the TOP20 countries with marketing investment amount
After the Spring Festival, there is a 5% -20% drop compared with that before the Spring Festival, and this trend may continue until the epidemic is effectively controlled. We can predict that the epidemic situation does have a certain effect on the user’s psychology, but the overall impact is not great. There may be differences between different products in different categories, and we will analyze them in more depth in subsequent articles.
4. From the specific data look
CVR data in key countries / regions have generally been affected by the epidemic after the Spring Festival, with a drop of 5% -20%.
Note: Change rate = (after the Spring Festival / before the Spring Festival -1) * 100%
Three, the impact on the cross-border e-commerce supply chain
With the development of the epidemic, contradictions in the supply chain of the cross-border e-commerce industry have become increasingly apparent. The survey shows that most domestic cross-border e-commerce sellers’ inventory can only be maintained for 1-2 months. The business model has no inventory, which means that no goods to sell is the biggest difficulty encountered by sellers today. We believe that the most critical issues in the supply chain of cross-border e-commerce under the epidemic situation are factory shutdown, seller inventory rush, blocked logistics and distribution, and tight cash flow. Here we focus on factory shutdown, seller inventory rush, and logistics distribution blocked Difficulties and cash flow issues will be explained in detail in the next topic.
1. Factory side
The survey shows that more than 90% of the factories in the country are still stopped. Although the policy allows resumption,The resumption approval process is complicated, and the resumption day is to be determined. Our preliminary judgment is that labor-intensive industries (such as the apparel industry) The resumption time node is about mid to late February to early March. After the factory is fully resumed, the production capacity is expected to be restored in about 2-4 weeks.
1) Downstream of upstream raw material manufacturers
Take the garment industry as an example. The upstream of a garment processing factory is a textile factory. Generally speaking, orders for garment factories are sent to the textile factory as a whole. The raw material cloths for garment factories are only stocked for at most one month. Investigations have shown that since the outbreak of the outbreak, many textile factories in Nantong, Jiangsu, China ’s main area for cloth production, have been shut down. The resumption day is expected. The shutdown of the weaving factory has seriously affected the summer and autumn production preparations of garment manufacturers.
2) Complex application process for return to work
It is understood that the provinces throughout the country (districts, cities) The government has strict requirements for resumption of work, and the application procedures have been continuously adjusted. Resumption of work before no later than 24:00 on February 9th, from the actual situation, the resumption time of most enterprises is in an uncertain state. The industries most affected by the delayed resumption of work are mainly industries with a large number of employees, such as manufacturing, construction, and service industries, who cannot work remotely. Prior to the end of the epidemic, resumption of work must be filled out by companies in various places. Investigations have shown that Shenzhen’s materials for resumption of work include 7 items, as detailed in the table below:
At the same time, we learned that in Wenzhou, which has small and micro manufacturing enterprises as its main industry, in addition to implementing high standards for personnel quarantine, the local government has also adopted a method of cutting off the power supply of the company to restrict factory resumption.
3) Workers’ arrival time is uncertain
With the development of the epidemic, the local government’s control over population entry and exit has become more and more strict, resulting in many workers unable to return to the city where the factory is located to resume work. First of all, the urban and rural towns where most workers live have implemented a road closure policy, and workers cannot come out after the holidays. Secondly, Beijing, Shanghai, Guangzhou, Shenzhen and other major cities have become more and more strict in the control of foreign populations. Even if workers leave their hometown, they cannot enter the city where the factory is located.
Taking Shenzhen as an example, relevant measures were issued on February 9th. All people living in various residential quarters and urban villages are required to enter and exit the district to implement authentication management. That is, each resident must present the system certification code or person. You can enter and leave the area only after your pass. At the same time, outsiders and vehicles must not enter the community. At the same time, Fuyong District of Shenzhen also enforced quarantine for 14 days on migrants returning to Shenzhen from 1 province, 8 cities and other key epidemic areas.
Shenzhen ’s measures reflect a phenomenon. In order to reduce the risk of epidemic spread caused by the climax of returning to cities, major cities have adopted measures such as control and isolation for foreign populations. The factory is originally a labor-intensive industry. Such a control policy will inevitably affect the resumption of production at the factory.
4) Estimate of production capacity recovery cycle
We have observed that the state and local governments at various levels have issued a number of policies to actively support resumption of work. Based on comprehensive information and interviews with industry experts, we make estimates of the production capacity of labor-intensive factories: At present, the time for resumption of work required by various places has arrived, but the resumption of the factory objectively needs to meet strict epidemic prevention requirements and approvals, and it is necessary to wait for employees to return one after another. It is inevitable that the management of the upper part of the company has a cautious wait-and-see attitude, so it can only partially restore production capacity. With the epidemic under control, it will gradually restore production capacity to its pre-epidemic level. If the epidemic will stabilize in March and end in April, it is estimated that the overall recovery of production capacity will begin to accelerate in March and return to normal levels in April. However, considering that some orders will be transferred overseas during the epidemic, the domestic production demand will be poor after the capacity is restored, and the capacity may be slightly lower than the level before the epidemic.
(Note: The above picture is only a schematic diagram and does not represent the real situation)
2. Inventory side
1) Status and dilemma
With the continuous development of the new crown epidemic, cross-border e-commerce industry inventory contradictions have become increasingly apparent. The survey shows that most domestic cross-border e-commerce sellers will face insufficient inventory problems from the end of February to the beginning of March; from the perspective of scale, It is more difficult for small and medium sellers to replenish stocks, and the impact is more serious. From the perspective of categories, multiple clothing / daily-use department stores are located in areas with severe epidemics, and these categories are more affected. A survey by Hugo.com on January 31 showed that more than 76% of sellers currently face insufficient inventory, of which 49% have 10-20 days of inventory, and 51% of sellers have completely broken Goods, of which small and medium sellers are particularly serious.
Through interviews with industry experts, we learned that, except for some customers who have overseas warehouses, the supply chain of most customers has difficulties. Compared with the big sellers who have priority to supply factories after resumption, the supply chain is unstable. It is difficult for SMEs to replenish their inventory in the short term, and the situation is still grim. At the same time, the supply chain of different categories is affected differently. For example, Hubei, Guangdong, Zhejiang, and other places are all regions with severe epidemics. The main daily-use department stores / clothing production areas in the above areas, such as Wuhan, Shenzhen, and Yiwu, are generally closed, and the resumption date of Hubei is difficult to determine. Many restrictions, resulting in a large number of grocery / clothing sellers are out of stock.
3. Logistics terminal
In the new crown epidemic, many countries / regions have adjusted their air and sea transportation policies and measures, including flight outages and quarantine / recommendations, which have affected cross-border e-commerce logistics to a certain extent: p>
1) From the air
Air cargo is not affected, but passenger flights to and from China are generally suspended around the world, resulting in a significant short-term decline in the capacity of the passenger’s belly-cabin logistics. Overall, the impact is average. In China, more than 50% of flights have been cancelled by 41 domestic airline companies, and the capacity of domestic passenger cabins has been more affected.
2) From the sea
Asia-Pacific (Southeast Asia, Australia, etc.) The implementation of relatively strict isolation measures for ships travelling to and from China has resulted in a significantly longer transport cycle and affected More serious; Kuwait, Brazil and other places only need to provide relevant health statements, the impact is relatively small. It should be noted that with the development of the epidemic, policies are tightened, such as the suspension of flight time in Europe.
In terms of domestic logistics, on February 10, the official Weibo of the State Post Bureau said that express delivery will resume normal operations. At the same time, postal parcels, domestic branches of international logistics, and domestic cross-border logistics companies are gradually returning to work. This means that in terms of domestic logistics express delivery, except for areas with severe outbreaks such as Wuhan and Hubei, other areas will gradually recover.
We summarize the logistics rework situation so far. It should be noted that the delivery service capacity and service time of individual cities for express delivery services will be readjusted according to the local holiday delay policy, and merchants can follow the official release or consult manual customer service; the Shenzhen-Hong Kong land port policy currently affects passenger transport at some large ports Corridors and freight corridors are not affected; Hong Kong freight forwarding is not affected by the epidemic.
Four Response Strategies
According to the current situation of the industry, Feishu Shennuo gathered a number of industry experts, conducted in-depth interviews with e-commerce sellers in different fields, and finally concluded the following countermeasures for your reference:
1. Purchasing strategy
1) Stocking
For the products being sold, it is recommended to confirm the resumption time, capacity and delivery time with the factory in time. For example, you can make an appointment with the factory for production capacity and goods, to ensure that the factory will produce immediately after resuming work.
2) On the new
Contact cooperating suppliers to provide their accumulated seasonal product inventory or directly sell summer product pre-sale models.
3) Selection / Adjust SKU
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