The Chinese New Year marks the end of winter and is often called the Spring Festival or the Lunar New Year. It is among the most important festivals in China and is similar in prominence to Christmas’s Western holiday. During the Chinese New Year, it is a tradition for the Chinese to visit their families.
These visits, known as Chunyun, often start a week before and may last a week after the New Year. This means that factories take two to three weeks off. Any eCommerce company with Chinese suppliers for the Chinese New Year needs to consider the changes in production in sales.
According to the lunar calendar, the Chinese New Year falls on different days during the year, but it is always between January 21 and February 21. In 2021, the Chinese New Year will be on February 12 and will usher in the Ox year.
Sales During the Chinese New Year
Rather than gifts, it is traditional for the Chinese to give hongbao or “red pockets” of money during the New Year celebration. However, sales of certain items tend to rise during the Chinese Lunar Festival.
Since people are given time off work and are at home with families, Chinese New Year eCommerce tends to be strong during this time. Usually, more money is spent on the cinema, restaurants, and entertainment in January and February.
However, this year, due to the pandemic, the numbers for entertainment and restaurants may not be as strong. However, this means people will spend more time online, which is good news for eCommerce businesses with Chinese customers.
Digital hongbao is rising in popularity, with 68% of Statista respondents saying they were receptive to giving or receiving digital hongbao. Spending tends to increase during the New Year, with 36% of Hong Kong residents preparing to spend more money during the Spring Festival.
Suppliers During the Chinese New Year
Although some types of consumer sales may be healthy during the Chinese New Year, companies that outsource from China or drop shippers with Chinese suppliers will have to plan ahead for the Spring Festival.
Festivities usually being on the eve of the Chinese New Year and last for two weeks until the Lantern Festival, but most Chinese are given a vacation time of 7 to 8 days from the beginning of the festival to the end of the first week. Factories tend to stop production a week before the festival, so workers and travel home to their families.
Some factories will not start production again until a few weeks after the festival, which means that there may not be stable production from Chinese suppliers in 2021 from early February to the end of the month or even early March. This is a considerable amount of time, but with advance planning, interruptions in delivery could be minimal.
One way to avoid delays during the Chinese New Year is to stock up on popular items. However, this could pose some difficulty for some types of dropshipping. It may be best to avoid Chinese New Year AliExpress dropshipping because AliExpress’s retailers don’t hold their own inventory. Planning in advance and finding alternate, non-Chinese suppliers during the Chinese New Year is a good strategy.
When dealing with Chinese suppliers, the best way to deal with production interruption during the New Year is to contact each supplier to determine when they are closing and re-opening and what items may be abundant or scarce.
Estimate your orders during the Chinese New Year, order extra inventory, and store it. Besides, notify customers that there may be some delays or items unavailable because of the Chinese New Year. Usually, customers are amenable if the issue is dealt with upfront.
eCommerce in Asia, Europe, and the U.S.
eCommerce is definitely popular around the world, and Asia has surpassed Europe in digital dominance. Industries in Asia are increasingly becoming digitalized. The emerging middle class in Asia and the promotion of eCommerce directly to social media users in Asia have led to an increase in online buying. The top eCommerce platforms in Asia are Alibaba, Rakuten, and Samsung.
European and American businesses are increasing their online exposure. ECommerce segments of retailers grew by the upper teens in both regions by 2019. The COVID-19 pandemic escalated North America’s growth with a 146% year over year growth in eCommerce sales in April 2020.
With the increase in eCommerce, many businesses are looking for more comfortable, more profitable ways to benefit from the trend. For those who don’t want to deal with storing inventory, AliExpress allows users to set up an online store with no fees, and they can stock their virtual inventory with AliExpress items.
In addition, AliExpress items are at a lower cost than comparable products elsewhere. This improves margins and profitability. Images, product descriptions, and other marketing materials are provided by the site can attract customers who already recognize and trust the Alibaba brand name.
How to Have a Truly Prosperous New Year
It isn’t challenging to navigate the Chinese New Year. Online businesses simply need to plan ahead by finding alternate suppliers. Those involved in drop shipping may consider stocking some inventory of popular items. Keeping customers in the loop about possible delays is a good strategy. For most of the year, AliExpress dropshipping is a profitable way to sell online with low priced and impressively presented products.
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