China’s major electronics manufacturing hub and sprawling electronics marketplace is now selling beauty products to customers.
The delivery staffs who once hauled computer parts and knock-off phones in the carts are now carrying Mac lipsticks, Bioderma cleanser and other international beauty brands.
The wholesale cosmetics retailers have started their business in 1,400 stalls in the Mingtong mall. And the merchants are expected to operate the wide market until 2 AM to meet the booming demand.
“It doesn’t matter what promotions are happening, it’s this busy every night,” said a seller surnamed Ying.
Ying opened her cosmetics stall three months ago and she is part of a quick makeover in this entrepreneurial city’s landmark electronics market.
Huaqiangbei has hundreds of multi-storey malls which was home for about 38,000 companies that have historically sold microchip reels and other components. It is also a matchmaking hub for the multinational businesses who wish to get products manufactured from the nearby factories.
Lin Muxu, general manager of the Mingtong Digital City market, who has worked in Huaqiangbei for 15 years said, “We used to just sell phone parts, but by 2016 some of the markets were 50 percent vacant, so we needed to try something else to survive. We saw there’s a great demand for beauty products, whether it’s teenagers, women or men in their 60s and 70s.”
The beauty business
According to official data, Chinese consumers have a high demand for cosmetics. The cosmetic market witnessed increased sales of $39.26 billion, showing a hike of up to 5.9 percent in annual data from January to October. But, the wholesale-retail sales fell 5.9 percent during the same period.
“Although Mingtong had hosted a smattering of cosmetics dealers for several years, the business took off this year when border closures halted the flow of traders going to Hong Kong and picking up tax-free goods for resale,” commended representative of wholesalers.
A trader named Scott said, “For importers with the right licenses, we can buy in bulk here and sell products at a few cents’ markup each. It’s a bit of a grey area,” he said, adding that not all sellers report or go through proper channels for their imported products.
Some customers buy products in small lots on the market to sell on Chinese eCommerce websites such as Alibaba’s Taobao.
“It’s a few at a time, but we’re moving such volumes that there’s a good profit to be made,” Mr. Scott said.
Seller Eva Zhou said all her European cosmetics were genuine, though near the end of their shelf lives. She fears that as more sellers flock to the market, margins will be squeezed more.
“I think a lot of people have lost their jobs with the virus, and now there’s good money to be had here, but it won’t work if everyone is doing it,” she added.