China-focused retailers get ready for world’s biggest spending spree
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ASX-listed retailers selling into China are getting ready for the world’s biggest shopping event — Saturday’s Singles Day.
Singles Day — which started as an ‘anti-Valentine’s’ celebration for Chinese singles — has grown into a giant sales that dwarfs even America’s Black Friday.
Online sales in China on November 11 are expected to eclipse last year’s total of $US17.8 billion ($23.2 billion) in just 24 hours.
The growing participation of international retailers — including a dozen or so ASX-listed sellers — is expected to push sales to $US23 billion this year, according to consultancy Oliver Wyman.
Infant formula producers Wattle Health (ASX:WHA) and Bubs (ASX:BUB) are well poised for a slice of the spending spree. Bubs announced its listing on shopping giant Alibaba’s Tmall just in time.
Under an agreement with stockists Chemist Warehouse — which reportedly had the highest sales of any Tmall storefront last Singles Day — all parcels dispatched during the event will include a virtual reality brochure of Bubs products.
Bod Australia (ASX:BDA) and Abundant Produce (ASX:ABT) will compete in the cosmetics and healthcare segments.
Abundant’s tomato face cream was added to Tmall’s global ‘Must Buy’ product list. Endorsements from Weibo and WeChat bloggers are expected to drive demand.
“Only days away from Double 11, our live face cream shows have already had twenty million views,” chief executive Shanan Birkin said.
“We have stock lined up and are quietly confident of achieving strong online sales this weekend.”
Ginger and nut producers Buderim Group (ASX:BUG) will similarly be hoping for a look in.
Capitalising on the Chinese demand for Australian products, daigou retailer AuMake (ASX:AU8) will be looking to sell its newly acquired ugg boots to Chinese shoppers.
On the B2B side, export logistics chain JAT Trading (ASX:JAT) and intellectual services provider Smart Trans (ASX:SMA) also stand to benefit.
Online sales growth in China is driven by the country’s rapidly expanding middle class which is expected to account for a third of the population by 2030 — equivalent to adding an economy the size of Germany.
Last year Single’s Day’s 24-hour online sales total eclipsed Brazil’s e-commerce sales for an entire year.
The day shifts more products than Black Friday and Cyber Monday shopping days combined.