Business

Australian businesses urged to embrace booming daigou industry

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Businesses are being encouraged to tap into the phenomenon that sees buyers purchase popular products such as vitamins or formula and send them back to China.

The daigou industry, which sees students, tourists and mothers buying Australian products on behalf of Chinese customers, shows no signs of slowing down, with Australia’s first dedicated Daigou Hub drawing huge crowds in Sydney.

Australian suppliers and small businesses are being encouraged to tap in to the shopping experience that spans continents.

Popular products

“The most popular products are the baby formula, vitamins and the skin care,” Daigou Seyana Huang told SBS.

The first specific working space for Daigou, which translates to “buying on behalf of,” and Australian suppliers launched in Sydney on Thursday.

Over 70 suppliers, a large number of investors, 150 daigou and a live viewing audience from China of 730,000 people were involved in the AuMake launch.

The Daigou Hub combines live-streaming technology and face-to-face supplier interaction to connect daigou directly with the suppliers of Australian goods in high demand.

“It’s quality, it’s the clean and green environment that we have here,” AuMake Chairman, Keong Chan said of the demand for Australian goods.

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Sydney based Cici He has been a Daigou for ten years.
Sydney based Cici He has been a Daigou for ten years.

'China's changing'

“China’s changing and the people who live there are changing too.”

Australian-based daigou can make thousands of dollars a year testing products live on social media.

Many of the daigou at the launch had tens of thousands of viewers watching them test beauty products or read out the ingredients of cereals or face creams.

Sydney-based Cici He has been a Daigou for ten years and has more than 12,000 viewers at a time.

“Daigou need to know [what the] customer are thinking, so we can produce good products for them,” Ms He told SBS.

The market value of the daigou business is estimated to be $300 million dollars, making it an attractive prospect for old and new businesses.

Organic food supplier June Superfoods only launched late last year, but has already had strong interest from the Chinese market.

Daigou's billion dollar industry
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“We just wanted to come down and see how it all plays out,” Co-Founder, Luke Derrin told SBS.

The Daigou Hub experience could soon be available nationwide, with AuMake eyeing off Brisbane and Melbourne locations over the next few months.

Seller beware

Sellers curious about daigou are warned to keep a look out for for knock-off products, a squeeze in profit margins and changes in regulation.

“Seller beware,” NSW Business Chamber General Manager, Paula Martin told SBS.

“It’s really important for Australian exporters to ensure they've got their right risk mitigation strategies in place.

“Look at all the possible available channels to you. Business to business, online strategies, the daigou channel.”

The Chamber says the daigou market is immense, mainly due to its ability to allow Australian businesses to immediately test the market.

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