Few days ago there was a post about Chinese sellers taking place on e-commerce sites making native “entrepreneurs” having nowhere to go. And so the victimhood became explosive.
What they didn't say that, the majority of their “business model” in the early days of Amazon was FINDING a good product from an existing brand and slap it on the marketplace. Not that it's a bad or unethical model, clever even. You fulfill a certain demand that others don't. But they got confused and thought that they were the ones who made good products.
How is it important?
Since they don't make the products themselves. The finding and the marketing are very important. You can't sell a good product from a local brand. Because, if everyone already has access to it, then why would they buy from you? You need to find a very good product from other countries that most people don't know. And a lot of those products are good too. So your profit is justified.
That brings the question, now that the foreign brand knows that their products are in demand elsewhere, why don't they just sell them directly?
You see, just few years ago, shipping costs were crazy expensive, and it took months to arrive. And if it didn't arrive, then you had to bear the cost. Between expensive shipping and a high possibility for parcels to get lost, if you are not careful, you might end up on the opposite of having a profit.
So who are the people who can make the most of this situation?
Is it the foreign brand that makes good products that people from another country want to buy it so much? Is it the designer or the cosmetic chemists that take pride in their good work?
No. It's the “entrepreneurs” who live in the US so they can distribute the goods once they arrive to US with low shipping fee and fast delivery. And they have family tie or connection to the origin countries where the products were made, so they can have the products shipped in with cheaper cost than other “entrepreneurs” who don't have the connection.
So now, traveling is easier, logistics is faster and cheaper, why wouldn't those brands just sell their products directly for a better margin? And in fact, they do.
And since “entrepreneurs” never learn to make products themselves, they can't compete with people who can, when their advantage of location and logistics is no longer the case.