AuMake, one of last year’s best performing ASX floats, has launched an experimental “Daigou Hub” and warehouse showroom to connect Australian suppliers with Chinese consumers.

A daigou (which means to buy on behalf of) is anyone outside China who shops on behalf of a China resident.

“Typically, daigous are students who are studying overseas, Chinese tourists or people who have migrated from China and are living in Australia,” the company said last year in its prospectus.

Often Daigou are Chinese students studying in Australia who buy here and on-sell into China via platforms such as Alibaba, JD.com and Tencent.

These expatriate Chinese, buying direct from Australian supermarket shelves, were responsible for the rapid growth of clean and green Australian infant formula sales into China.

AuMake was an ASX ten-bagger for those who got in early and sold late last year.

After floating in October at 8c its shares soared as high as 83.8c.

In January the company raised $14 million at 45c. The shares have since settled back to 29.5c.

AUMake shares since listing in October 2017 (ASX:AU8).
AUMake shares since listing in October 2017 (ASX:AU8).

AuMake plans further hubs in other capital cities, as part of the company’s strategy to provide multiple channels for Australian suppliers to connect directly with Chinese consumers via the influential daigou and Chinese tourist markets.

The Daigou Hub, a 430 sq m facility in the heart of Sydney’s Chinatown, includes a presentation space for supplier demonstrations, a cafeteria and children’s play area, product displays and an area designed for daigou to livestream their interaction with Australian suppliers to millions back in China.

“This leading edge initiative has been developed following extensive industry consultation with suppliers and daigou, and closely follows recent developments in the retail market in China, which has seen a move away from a pure online marketing model to an omni-channel model which combines engaging offline experiences for customers, coupled with advanced online functionality,” says AuMake’s chairman Keong Chan.

“Livestreaming for instance, is fast becoming a key component of the decision making for consumers in China when they look at the brands and products they are going to purchase.

“Being able to see, in real time, suppliers demonstrating their Australian product and interacting with their trusted daigou is the next evolution of their increasing desire to understand the origins of the product they are purchasing.”

AuMake’s Australian retail model for the Chinese market:

Source: AuMake

AuMake’s new Auburn warehouse showroom in Sydney’s west is designed for high-value Chinese tour groups and large scale daigou, with facilities to view and purchase new products and brands, and with regular demonstrations by Australian suppliers.

“Visitors can participate in a tour of the expansive warehouse and safely observe the production of UGG Aus/Jumbuck wool products from the public viewing area,” he says.

“That’s something that’s very appealing to Chinese tourists, it’s all about immersing themselves in the experience while they are here and reinforces the authenticity of the product they are purchasing.

“The Auburn showroom will also provide centralised and VIP services to large scale daigou who typically purchase in excess of $15,000 in product per week.”

This article first appeared on Business Insider Australia, Australia’s most popular business news website. Follow Business Insider on Facebook or Twitter.

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