Daigou, “Grassroots” Solution to Fighting Tariffs
Sandi Yu & S. Alexander · July 9, 2018
When it comes to becoming a Daigou, there seems to be a minimum amount of barriers of entry. As long as you are in a country other than China and have a WeChat account for posting product pictures, you can call yourself a “Daigou”. While these two requirements are easy to fulfill, it isn’t easy to become a successful Daigou.
Here’s a few requirements for it takes to be considered a good Daigou:
- Sales and negotiation skills with customers, with attention to details and extraordinary patience.
- Good sense of business opportunities and fashion trends.
- Willingness to devote to work 24-7, including OT on nights and weekends.
- Expertise to pack and deliver the parcels of goods, excellent knowledge of the postal services.
- Marketing and business development skills.
The market for Daigou shoppers is very competitive. There’s an estimated 1 million Daigous around the world; and in order to survive and succeed in such an environment, one must have their own secret weapons.
For some, this means focusing on a niche market such as NBA gear for a particular club. Other strategies include: creative marketing copywriting, cooperating with retailers in China, becoming a “key opinion leader” in the field with thousands of fans and followers, and teaming up with other Daigous to capture a larger cash flow and higher inventory capacity.
As mentioned on Wikipedia, the large demand for Daigou services is partly due to China’s high import tariffs. Which leads me to recent hot topic of the ongoing trade war between China and the US. This event has impacted multiple industries in both countries. Almost every Economics 101 course will tell you tariffs disrupt the free market and bring damage to the economy. At the end of day, who bears the cost? Well, the answer to that is consumer, of course.
Daigou is a “grassroots” solution to fighting tariffs. It ranges from being just a small one-time thing, where one travels abroad and buys a few goods for a friend or family at an airport tax-free shop, to being a serious business. There are even Daigou associations in some countries with officially certified Daigou agents and publicly listed companies. Some consulting firms use Daigou as an innovative marketing strategy for foreign companies to enter into China’s market.
When Uber and Airbnb first debuted, there were tons of concerns and opposition. Even now they are not allowed in some countries, but no one can deny the convenience they bring to our lives. For industry innovators like Uber, Airbnb, and Daigou, with better regulation and supervision, these “grassroots” innovators can grow and reshape the outdated industries to form a true modern way of living.