A．East Star Introduction
EastStar Holding Group was established in 1996, the headquarters is located in the world’s largest globalcommodities center-Yiwu in China. After 20 years development and precipitation,East Star is becoming an integrated Holding Group which own International trad and ebusiness and manufacturing industry right now.
Mainbusiness : International trade and Manufacturing Industry
East Star has invested largely funds in building aninternational trade integrated platform and has opened four purchasing centersin Yiwu, Guangzhou, Linyi and Shishi, East star also set agency in different countries such as Dubai, Algeria, Egypt,Saudi Arabia, Angola, Brazil and so on. We are currently equipped with over onehundred thousand square meters of warehouse space as well as professional ITsystem and experienced international trade service team group. The Group keepslong time and stable cooperation relationship with over twenty thousand suppliers.
East star come to manufacturing industry when running the business of international trade. In 1999, Zhejiang Hehe OrnamentCo. Ltd was established with investment of thirty million, which specializedornament production of alloy, copper silver, pressing, plastic, claw chain andresin. In 2003, Zhenjiang Meidai Cosmetics Co. Ltd was established with investment of sixty million and its self owned brand ‘Miss Rose’ has become a local famous brand and has acquired world brand authentication, ISO9001 SGS authentication,ISO022167 SGS authentication and GMPC authentication. In 2004, Zhejiang EastStar Ornament Co. Ltd was established with investment of fifty million toenlarge the scale of ornament production. In 2010, the Group has also invested 70 million in establishing the Zhejiang Dishini Knitting Co., Ltd, with worldadvanced equipment and technology imported from Italy so as to build a sock andunderwear brand facing the mid and high-end female market across the world.Dishini has now gained recognition and preference by customers at home and abroad.
2. International trade development history
Dubaiboth wholesale and retail business period (1995 to 2003)
In1995, Mr. Tong Changmao established The United Arab Emirates Dubai East StarTrading Co., Ltd. The business model issale Chinese commodities in Dubai market by company self. To take advantage of variety diversity, cheap price and centralized purchase of small commodities in Yiwu market, based on requirement of Dubai market, arrange shipment to Dubai inlarge quantity, then wholesale and retail in self-operated shop in Dubai. Themain profit resource is purchase and sale price differential.
b. International service period (2003 to2011)
Transformation background: With the development of China international trade, the popularity of Yiwu small commodities increased abroad, more and more foreign customer began to purchaseby himself in China, and in the meantime, a lot of Chinese merchants went aboard to sell Chinese products, which resulted in homogeneous competition seriously day by day. In 2003, Mr. Tong Changmao gave up the original international purchase and sale model and transformed to international trade agent service model.
Business model: provide foreign customers with international trade services such as ticket and hotel booking, airport pick- up, accompanied procurement by multilingual interpreters, production follow-up, goods reception and inspection, storage, safe keep, container loading,commodity inspection, shipment booking, customs application, cargo stuffing and goods payment etc. The main profit resource is international trade service charge.
c. International trade service transformation and upgrading period (2011 to now)
Transformation reason :from 2010, domestic suppliers face lots of problems such as high operating cost, financing difficulty, financial constraint, and debt risk etc, gradually reduce and control debt limit of foreign customers to relieve financial pressure and control risk. More and more foreign customers purchasing Chinese commodities directly, there is serious homogeneous competition in foreign market. Huge fund demand of foreign customers is resulted from receiving goodsand storage etc. With the strong desire of reduce storage and relieve fund pressure and control exchange rate risk, the less than container load (LCL) and batch delivery develop quickly. International trade professional service andintegrated service ability is required more because of the puzzle and demand of foreign customers and domestic suppliers, change of market and spring up of cross border electronic commerce.
‘EasyOver draft’ operation model : provide international trade agentservice to foreign customer, in the meantime provide suppliers with goodspayment finance based on real trade, international trade agent service charge and financial service charge is the main profit resource.
B. Business analysis of International trade services
1.Market trading characteristics
Guangzhou market product： Electronic products,Garment, shoes and hats, luggage, general merchandise,furniture, decorative lighting, building materials, glasses, it’s main on cash transaction. Yiwu market product: general merchandise, hardwareg lasses, luggage, Shoes and hats, garment,, It main sell on credit Shishimarket product: garment, shoes and hats,It’s main on cash transaction Linyi market product: building materials, hardware. It’s main on cash transaction.
2. North Africa customer characteristicsSource of North Africa customer:Algeria, Egypt, Saudi Arabia, Libya, sultan, Tanzania .More and more customer come to purchase product bypass the middle men, North Africa market homogeneous competition becamemore competitive, Profit is more and more thin, Customer control of the inventory, cost and risk consciousness more strongly, A single customer purchase quantity is obviously decline Customer purchase Small amount,mixed varieties, they book different types of goods from a dozen or even hundreds of suppliers, two or more than two customer book just one container .Due to the foreign exchange control and tax factors, Customers come to china to purchase with some cash himself, Part payment for goods payment by L/C or collection, the balance by underground remittance.