Founded in 2004, the Beijing-based B2B wholesale site DHgate.com has now become more and more popular both among Chinese sellers and international buyers from more than 200 countries and regions. As an online transaction platform, DHgate is best known for its innovative business model.
Unlike other information-oriented wholesale marketplaces, DHgate does not charge membership fee on either buyers or sellers. Instead, it charges buyers a certain percentage of commission (3-10%) for successful transactions. In the past, the wholesale was completely free for sellers. However, in early January, DHgate launched a special value-added service called “DHfactory” or “Factory Zone” and the sellers who apply for this service are required to pay an annual fee of RMB 8,800. It is expected that DHgate will continue to launch more exclusive services and improve its business model as a response to the furious competition among the many China wholesale companies.
Also, DHgate supervises the whole transaction process. Sellers and buyers are not allowed to exchange contact information on the site and all the trading activities are under the supervision of the site. Otherwise, they will be punished by the site. For buyers, this rule has both pros and cons. On the one hand, this means buyers have no chance to trade directly with sellers, thus not being able to get the even better prices without the third-party’s share of profits. On the other hand, this can greatly guarantee a safer and better trading experience as DHgate offers Escrow payment service to protect buyers and their customer service department would help resolve any problem or dispute occurred in any transaction.
DHgate mainly targets at small and medium-sized Chinese enterprises and international buyers. As a result, their average order sizes are relatively small. However, you can find a wide range of item categories from apparel, handbags, shoes, sporting goods, toys, jewelry to consumer electronics, cell phones, musical instruments, car parts and accessories, video games, etc. It is claimed that there are more than over 10 million product listings being sold on the site.
DHgate has maintained a fast but steady progress since its foundation. Due to its outstanding performance, the site was awarded the Deloitte Technology Fast 50 China 2008, a famous award which recognizes excellence in high-tech companies in the fields of technology, media and telecommunications. Besides, DHgate has become PayPal’s biggest client in the Asia-Pacific region. According to the statistics released by DHgate, the wholesale website currently has 1.4 million active buyers from 230 countries and regions and more than 300,000 China-base sellers. And it was reported that the site’s transaction volume almost reached RMB 1.4 billion in 2008 and is intended to exceed RMB 2.5 billion in 2009.
For more information, go visit DHgate.com
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