The peak season promotions in the second half of the year are in full swing. According to Deloitte's forecast, during this year's holiday season, US consumers' online shopping spending will increase by 7% to 9% to reach $1.3 trillion. The continued rise in shopping enthusiasm is undoubtedly a good sign for many Amazon sellers.
Looking back at the turbulent off-season in the first half of the year, the wave of account suspensions and price wars took turns to invade, and many industry giants unfortunately fell. The performance growth of many small and medium-sized sellers showed weakness, and the report cards disclosed by big sellers also seemed to show a downward trend. Now that three quarters of 2021 has passed, can they turn the tide and stabilize their foundation, or will they be unable to resist the downward trend? Cross-border navigation , net profit plummeted 2749%! Youkeshu's parent company announced Q3 results #Amazon##Cross-border headlines#Cross-border e-commerce video account ▲ Video account focuses on cross-border navigation Tianze Information's performance plummeted, with net profit plummeting 2749%! It is learned that Youkeshu’s parent company Tianze Information recently released its third-quarter financial report, and its performance plummeted. During the reporting period, Tianze Information achieved operating income of approximately RMB 299 million, a year-on-year decrease of 68%; the net profit attributable to shareholders of the listed company was approximately RMB -207 million, a year-on-year drop of 2,749%. ▲ The picture comes from Juchao Information Network In the first three quarters of this year, Tianze Information's overall performance continued to decline, with total operating revenue of 1.48 billion yuan, a decrease of 55.4% from the same period last year; net profit was -1.16 billion yuan, compared with 72.774 million yuan in the same period last year, turning from profit to loss year-on-year. The financial report shows that Tianze Information's performance plummeted in the first three quarters of this year, mainly due to the policy adjustments of the cross-border e-commerce industry platform and the company's business transformation, resulting in a reduction in sales scale. On the one hand, its subsidiary Youkeshu was involved in a ban in the first half of the year, with about 400 stores and sites banned on the Amazon platform and a total of about 128 million yuan in frozen funds. On the other hand, Youkeshu's independent station business layout has shrunk significantly, and its route transformation has also encountered bottlenecks. The successive shocks suffered by important subsidiaries have also directly led to the decline in Tianze Information's performance. ▲ The picture comes from Juchao Information Network In the face of the gradually widening performance decline, Tianze Information has also taken new actions recently. It is understood that Tianze Information stated in its announcement in response to the Shenzhen Stock Exchange's letter of concern that the company's cross-border e-commerce business revenue has declined significantly due to changes in the policy environment of the Amazon platform and fierce competition in the European and American markets. ▲ The picture comes from Juchao Information Network Therefore, in order to stabilize operations and improve performance, the company is working hard to explore more diversified sales channels and target markets. Changsha Youkeshu will rely on Aliexpress, Shopee and other platforms to focus on developing other emerging market businesses in Latin America, Southeast Asia and other areas that are not covered by traditional platforms such as Amazon. Shenzhen Youkeshu and other entities will continue to deepen their presence on Amazon, eBay, Wish and other platforms, focusing on mainstream markets in Europe and the United States. The supply chain crisis intensifies! Logistics delays become the biggest obstacle to explosive sales? Under the impact of the platform's successive turmoil, the overall performance of both large and small sellers this year is not optimistic. The arrival of the traditional peak season in Europe and the United States in the second half of the year is also a good opportunity for many sellers to turn losses into profits. However, despite the high shopping sentiment of consumers, the road to sellers' explosive sales is still full of challenges. Under the dual constraints of the COVID-19 pandemic and energy shortages, a severe supply chain crisis has swept the world and has become a major obstacle to peak season sales. According to Salesforce's online sales forecast, rising costs and insufficient supply will become the two major trends in the Q4 shopping carnival season. Salesforce estimates that 94% of orders during the year-end shopping season will be at risk of delays, and the delivery time of about 40 million packages will be affected. Logistics delays may become the biggest problem during this year's peak season. Freight costs have been rising steadily, breaking records time and again, but logistics efficiency has been getting lower and lower. Products cannot be put into storage and put on shelves in time, and even cannot catch the last train for holiday activities. Many sellers complain bitterly about this: "The 40HQ departed on September 23rd to LA, but was not allowed to dock at the port on October 7th. It is still anchored and will not be able to catch Black Friday." "The goods that were picked up by air on October 15th arrived in the United States yesterday. Customs clearance and unpacking are now taking 3-7 days, and delivery will take 3-5 days." "The charter boat that left in August has not yet docked, and the 4X40HQ that caught Halloween has been drifting for more than a month." In addition, package delays have further exacerbated the problem of returns. According to reports, during last year's peak shopping season, American consumers returned a total of $428 billion worth of goods, accounting for 10.6% of the total annual retail sales. The main reasons for returns were fakes, goods that did not match the description, or long delivery times. Recently, Amazon US also issued an announcement that, following FBA sellers, self-delivery sellers will also need to provide free return services to customers starting October 28. Problems such as unconditional returns, refunds without returns, and free products have not been completely resolved for a long time, and this situation will further deteriorate during the peak season. The situation is constantly changing. Is Amazon a hot spot or a pit? The platform's policies are becoming more and more stringent, operating costs are rising, and the peak season is approaching but there are many difficulties. Many sellers are asking themselves: Can Amazon continue to operate? Why are so many people willing to jump into the fire pit of Amazon when the environment is becoming more and more dangerous? One seller lamented that many sellers became famous overnight in 2020 by seizing the bonus, achieving a win-win situation in sales and profits, so that they were full of confidence at the beginning of 2021 and launched a large-scale distribution of goods at the beginning of the year. However, after the epidemic brought development opportunities, the pain period also came. Raw materials and freight costs rose across the board, and factory orders soared while prices continued to be suppressed, and profits continued to shrink. Although the overall market is sluggish this year, the seller is still optimistic that Amazon will remain a sunrise industry in the next few years. Some sellers said that the domestic e-commerce environment is too saturated and the competition is fierce, so many sellers have turned to Amazon as a new outlet. Compared with other third-party platforms and independent websites, Amazon has huge traffic as support and mature platform algorithms and systems. Although it is full of challenges, it is still undeniable that it has potential for development. Shenzhen Customs revealed that in the first three quarters of this year, Shenzhen's foreign trade imports and exports totaled 2.51 trillion yuan, a year-on-year increase of 15.2%. According to the relevant person in charge of the Statistics and Analysis Department of Shenzhen Customs, Shenzhen's monthly foreign trade import and export value has maintained year-on-year growth for 11 consecutive months since November last year, and the monthly import and export value in August and September this year exceeded 300 billion yuan for consecutive months. Judging from the development of Shenzhen, the main base of cross-border e-commerce in my country, the current development of export e-commerce is thriving and has become the main driving force of my country's foreign trade industry. Therefore, the cross-border e-commerce track is still a major outlet at present, attracting many sellers to compete to enter the market.
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