Routes to the Chinese Consumer: E-Commerce Presents a Growth Opportunity for Fresh Produce
China has been one of the world’s fastest growing import markets for horticulture produce over the past decade. For both Australia and New Zealand, China has been the fastest growing export market and is now top-ranked by value.
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China has become the highest value export market by share of receipts for Australia and the second highest for New Zealand. Both countries fit seasonal supply windows and are able to supply a range of produce that meets premium criteria and satisfy Chinese consumer demands for food safety and quality.
Over the past decade, China’s economic growth, rising urbanization, and demand for a diverse and premium range of products have underpinned investment in and the growth of e-commerce in China. “From 2015 to 2019, business-to-consumer (B2C) e-commerce sales of fresh food grew at a CAGR greater than 60%. We estimate that fresh fruit and vegetables accounted for half of this,” according to Hayden Higgins, Senior Analyst – Horticulture.
Any strategy for Australian and New Zealand exporters – either expanding sales in China or entering the market for the first time – should include sales via B2C e-commerce. But exporters should focus on sales to multiple channels and need to engage with a range of partners to avoid both channel- and partner-concentration risk. Export strategies should also factor in market risk and appropriate mitigation. This is particularly important for Australian exporters given the level and direction of political tension with China at the time of writing.