Case Study on Dongfeng Village and Shaji Town (tbc)

A Short introduction of Dongfeng Village

Dongfeng Village is an administrative village (行政村) located 100 kms away from Downtown Xuzhou City, and is on attachment to (隶属于) Shaji Town in Suining County. A 20 minute drive from the center of Suining County can take us there. Prior to the advent of E-commerce in Dongfeng Village, its primary industry was used plastic recycling and processing(废旧塑料回收加工产业.) The first online store in Dongfeng Village, Shaji Town was registered online in 2006, selling wooden furniture. As of the end of 2013, 1283 Taobao online stores exist in Dongfeng Village alone, the number of which is even higher than the number of registered local households (1180.) In a small village of only 4793 population number, more than 2042 people started working in E-commerce/E-commerce-related business, such as logistics company, delivery, furniture company, etc, no longer staying unemployed or farming at home2. By the end of 2014, over 3000 Taobao online stores are based in Shaji Town, controlling more than 65% of furniture sales on Taobao (furniture is the second best-selling category of merchandise on Taobao.) In 2013 alone, the yearly sales figure in Shaji Town is over 1.5 billion RMB.

Interview subject 1: Sun Han, Dongfeng's 1st Taobao Entrepreneur Who Started from Nothing 孙寒,白手起家的东风村淘宝大亨
Sun Han is a Dongfeng native. After attending a college in Nanjing for 2 years, majoring in tourist management, he decided to drop out to start working. He first worked in Nanjing as a stunt actor, then attempted at wine business in Shanghai with no avail, eventually ended up moving back to dountown Suiyang County to work in a mobile company. In 2006, he moved back to Dongfeng Village, purchased his first desktop computer, and opened the first online Taobao store in town as a local agent selling electronic devices and small-scale furniture. At the beginning, the business was mediocre; Sun Han almost decided to quit again, until he went to Shanghai in 2007 and visited Ikea. Inspired by their design and business model, he bought a few samples, took them back to Dongfeng, and hired a few carpenters to implement their original designs and manufacture them to sell online. Unexpectedly, the proceeds of sale rose to over one hundred thousand RMB in the first month.
Dongfeng used to be known for its useless plastic recycling and processing industry. While it supported the locals financially, it brought more problems than benefits, not only causing a great deal of environmental pollution, but also earning the town a laughable title —“trash town.” After witnessing Sun Han's success, Dongfeng natives started opening online stores one by one, all selling locally-manufactured and low-priced furniture, just like Sun Han did. This spreading trend marked the beginning of a brand new era for Dongfeng.

Many impacts of the thriving E-Commerce industrial chain:

1. bring force the development of:
manufacturing industry (250+ Furniture manufacturing company as of the end of 2014)
logistics and delivery industry (45+ companies as of the end of 2014)
component supplies industry
other new industries such as e-commerce agency, photography studios, product design, etc. (in order to make their products stand out on Taobao)
2. attract young Dongfeng natives who previously moved to urban areas seeking jobs and career opportunities to move back to their hometown, and other nonnatives to move to this rural village for brighter future

Interesting anecdotes:

1. 关于沙集镇电子商务的展开,沙集镇政府最初也是“吃了一惊”,孙寒回想,“2009年以前,镇上曾经有很多家电商在卖家具了,但镇政府一点儿也不晓得,直到越来越多的快递、物流进来,镇政府才发现原来镇上有这么个产业,2010年全镇的电商买卖额超越了3个亿。”
The town government was not aware of this E-commer phenomenon and its potential to revitalize the town's economy and culture until 2009, when many delivery and logistics companies started to come into town to set up their branches.

2. 近年来,家具网销生意虽然红火,但基础设施配套跟不上、运营管理不专业、抵御市场风险能力低等一系列现实问题也已凸显。为引导沙集电商产业升级发展,省商务厅累计拨付专项资金800余万元,扶助睢宁农民网络创业进行科学产业规划和布局。沙集电子商务创业园于2011年底启动建设,如今已基本建成,建筑面积达5.1万平方米,涵盖生产加工、物流仓储、电子商务、商务服务等诸多功能。

Despite the hot furniture sale online, the crude infrastructure, unprofessional operation management, poor market risk management ability and other problems became to seem prominent. In order to lead the E-commerce industry further, the Department of Commerce of Jiangsu allocated 8 millions of funds to Shaji. Meanwhile, the local government began building Shaji's first E-commerce park and incubation center(创业园) in 2011, the first phrase of which had already finished by the end of 2014. The floor area of the park is over 51,000 square meters, providing a series of functions such as manufacturing, logistics storage and management, E-commerce, business service, etc.

3. 采访中,孙寒提到了一个细节,目前沙集镇在网上做生意的,年龄最大的有七十多岁、年龄最小的只需十四五岁。“七十多岁的老人,只用两个指头敲键盘,照样把生意做起来了。十四五岁的小年轻都在镇上、村里搞个网店什么的。”
The youngest Taobao store owner in Shaji is 14, and the oldest is almost 80 years old. According to Sun Han, “for a 7o-year-old woman, she only needs two fingers and some clicking on the keyboard to be just as successful as many others.”

Posted by Alvin Li / 7.2 years ago / 8594 hits