Made to Reorder

However, Wen said one of his most notable orders was placed during the Qatar FIFA World Cup 2022 from a client in Argentina, who requested over 2,000 T-shirts before the final match.　

Designed after Argentina’s national team jersey, the shirts featured three yellow stars: two marking Argentina’s wins in 1978 and 1986, and the third a hopeful prediction for 2022.　

Clearly a betting man, the client put down a 40-percent deposit on the order. The client agreed to pay the remaining 60 percent only if Argentina won.　

“He asked me to send the T-shirts to the airport before [the final match on] December 18 and wait for the result,” Wen told Chongqing based media CQCB.com. Luckily for all involved, Argentina won.　

For the past 20 years, Yiwu has been a manufacturing hub and wholesale market powering China’s e-commerce transformation, producing small commodities on a huge scale.　

While the city became synonymous with trinkets and cheap consumer goods, the next generation of manufacturers, many of whom inherited family factories, are leveraging new technology and sports events to drive innovation.　

Last month, a video of eight female entrepreneurs from Yiwu promoting their products aired on a screen above Times Square in New York City. Using a simultaneous AI translation tool, the women appeared to be speaking in English, French and Arabic.　

“The ad aims to shake the stereotype that Yiwu products last no more than three days,” Zhang Yafang, new media operation manager with analysis firm China Commodity City Big Data, told NewsChina.　

Boosted by demand from the Paris Olympics and the UEFA Euro 2024, Yiwu saw obvious growth in price indexes during the third week of June for sports balls, sportswear and Olympic-themed accessories, most of which were shipped to France, Germany and Spain, Yiwu-based Zhejiang China Commodities City Group said on June 25.　

Lin Daolai, Huyue’s general manager, reported 10 percent year-on-year revenue growth in 2023. With their manufacturing based in Dongguan, Guangdong Province, Huyue managed to lower costs beyond the reach of other Yiwu competitors, Lin told NewsChina.　

Today, made-in-China Olympic souvenirs dominate the retail market in France.　

At a store near the Musée d’Orsay, France’s national museum of fine arts in Paris, two-thirds of its shelves are filled with Olympic souvenirs. According to Chinese tourist Cao Yue, most of the products, including flasks, key rings, emblems and plush toys, had made-in-China labels.　

In November 2022, the Paris Organizing Committee for the Olympic and Paralympic Games announced that 80 percent of the estimated two million items featuring the Paris 2024 mascot Olympic Phryge, which is designed after the triangular caps worn during the French Revolution, would be outsourced to Chinese manufacturers.　

However, Yiwu manufacturers have not reported receiving any orders for mascot merchandise, according to Huang Junqiao, director of the export department of the Yiwu Bureau of Commerce.　

This could be because most Yiwu manufactures, which operate modest workshops, are simply too small to handle large orders with strict quality controls, an anonymous local import-exporter told NewsChina.　

But many factories do not report receiving such orders due to non-disclosure agreements. “Concerning intellectual property (IP) protection, many big foreign trade orders are kept confidential. As a consequence, suppliers always keep their mouths shut,” explained Zhou Huaishan, executive director of Yiwu Business Think Tank.　

Due to the stringent IP controls for major global sports events, many Yiwu businesses focus on peripheral products such as glow sticks, trinkets and toys to avoid infringement issues.　

While less lucrative than licensed Olympic products, small businesses aim to attract customers with creative ideas.　

Glow sticks in the colors of the French national flag are hot sellers at Shuaite Toys, said a wholesaler at the Yiwu International Trade Market, one of the city’s major wholesale complexes.

　

Shuaite owner Guo Huiping said that most of her orders come from France, resulting in 20 to 30 percent year-on-year revenue growth for her store. Her largest order was for 50,000 units.　

Meanwhile, business owner Liu Ruqun created 11 types of earrings featuring the tricolor French flag, all of which sold out after their April debut. Liu is now designing necklaces to cash in further on the Paris Games.　

Some original equipment manufacturer (OEM) products, such as a toy rooster, are surprise bestsellers. “Lots of people mistake it for the Gallic Rooster [a national emblem of France] of the upcoming Olympics,” said store owner Miaomiao.　

“Tough negotiations with customers or accusations of IP infringement can squeeze every possible margin from manufacturers, who rely solely on their assembly lines,” he told NewsChina. “However, with original designs, I can assert more control over pricing,” he added, mentioning that he has obtained product licenses for World Cup 2026 to be hosted by the US, Canada and Mexico.　

Between January and March, Yiwu’s exports of sportswear and equipment hit 1.86 billion yuan (US$260m), up 51.9 percent year-on-year. Soccer balls alone contributed 450 million yuan (US$61.88m), soaring by 73.9 percent year-on-year.　

Huang attributed this exponential growth to the previous year, when local businesses were still recovering from the pandemic’s impact. But with overseas demand and exports rebounding after the three-year pandemic, competition among suppliers in Yiwu intensified.　

About 100 more stores in Yiwu’s small commodity markets started to sell soccer balls as the Qatar World Cup 2022 approached, Wu Xiaoming, chairman of equipment maker Yiwu Aokai Sports and director of the Yiwu Sports Goods Association, told NewsChina. In 2022, the cheapest soccer ball cost 8 yuan (US$1), two yuan more than the current price.　

“With lower thresholds for investments and technologies, Yiwu’s sports industry, particularly its soccer products, always heats up once every four years. But after the fervor dies down, most suppliers slash prices to clear their inventories,” Wu said.　

At its peak, Yiwu was home to 70 soccer ball factories. But as labor and rent costs increased, most moved to Henan, Anhui, Sichuan and Guizhou provinces. Only four remain in Yiwu.　

Wu has kept his factory capacity at 120,000 balls a month to concentrate on quality and attract high-end customers.　

“Soccer ball orders from the US and Europe are declining and medium- and low-end products are hardly profitable. All in all, our orders have declined tenfold,” an anonymous local soccer ball producer and seller told NewsChina.　

Every major sports event creates a large supply chain. During Qatar 2022, Wu’s factory shipped one million soccer balls, 100,000 of which went to a wealthy Qatari customer whose company also sponsored the World Cup.　

Yiwu is also seeing fewer orders for Paris Olympics products.　

“The decline of consumer purchasing power in Europe has prompted EU clients to look toward less costly suppliers in countries like Vietnam, Pakistan and India,” Wu said.　

To address the changing landscape while avoiding the price wars that plagued Yiwu manufacturers in the past, Wu with the Yiwu Sports Goods Association focused his factory on producing league-standard soccer balls and pursuing direct cooperation with overseas soccer clubs and associations.　

“From the perspective of the industry association, we urge businesses to focus on personalization, branding and developing product lines. We encourage them to establish their own product standards for corresponding price ranges,” Wu said, adding “This way, we can approach the market differently and find the customers who suit us most.”　

In 2017, four years after inheriting her family’s business, telescope maker Yiwu Inre Optical Instruments, Chen Jiajia registered her brand trademark in China and the US. Challenging Yiwu’s image as a manufacturing center of cheap products, Chen is aiming to compete with international brands in the mid- and high-end markets.　

However, Chen told NewsChina that developing an independent brand in a city where manufacturers are accustomed to filling orders for clients is not so easy.　

She pointed out two telescopes in her showroom: one made for American clients and the other developed in-house. While the former’s annual shipments usually reach 20 million units with little fluctuation, the latter has struggled to generate profit even with a price drop from 110 yuan (US$15) to 80 yuan (US$11) over four years.　

Despite these challenges, the confidence of Yiwu’s younger entrepreneurs remains strong. They believe that establishing global brands, despite temporary setbacks, is a way to offset the relentless costs of low-end product price wars in the Chinese market.　

“I never imagined the toy market could be so competitive,” Sun Lijuan, who owns Shenghong Toys in Yiwu, told NewsChina. She explained that amid increasing competition, many former clients have sought alternatives in Guangzhou, Guangdong Province, Hebei Province and even overseas markets. With declining demand, Sun realized she must explore more sales channels.　

From May 30 to June 1, 2024, Sun participated in the China Yiwu International Commodities Fair held in Indonesia. With her main customers from the Middle East and southern Africa, she secured two orders and fielded dozens of inquiries.　

“More than selling goods at the fair, it made me happier to see my products entering a completely new market abroad,” Sun said, adding that product innovation must pair with new sales channels to be effective.　

AI technicians are also lending their skills to Yiwu businesspeople seeking to promote their products abroad.　

Sun was among the first to use an AI simultaneous interpreter developed last October by ChinagoodsAI, a tech platform in Yiwu that supports local businesses and trade.　

Speaking a few Chinese sentences in a video, Sun and all her Middle Eastern customers were amazed to see her speaking impeccable Arabic. The AI tool helped Sun’s business in the Middle East grew by 20 percent in the latter half of last year.　

Yiwu’s transformation is driven by individual innovation and technological support. On May 23, Yiwu rolled out Zhejiang’s first app to facilitate foreign trade with digital administrative services, including accommodation bookings, visa applications, work permit issuance and access to foreign exchange settlement accounts.　

“All we have done and will continue to do is to facilitate trade by streamlining procedures and cutting costs. These efforts can be fulfilled through the one-stop service of our digital platform,” Fang Zhengping, president of the Yiwu China Commodity City Research Institute, told NewsChina.