Wholesale Market System has Unique Competitive Advantage in China

Posted by Roc Wang on July 7th, 2019

Under the combined effect of market choice and policy promotion, great achievements have been made in the development and construction of china wholesale sourcing.

As the convergence point of logistics, capital flow and information flow, china wholesale sourcing system not only completes the functions of commodity distribution, transaction settlement in the national market, but also plays the roles of price formation, information synthesis and adjustment of supply and demand. However, under the market structure in which the wholesale market system occupies an absolute dominant position, problems such as dirty and disorderly market environment, high loss rate in circulation process and unstable market price persist for a long time exist all the time. Its root lies in the single market function and business model, the low degree of organization of participants, the lack of differentiated business division, and the lack of endogenous motivation for operators to invest in upgrading facilities and change business models.

At one time, academia and public opinion have paid great attention to other modes of well-functioning developed countries in Europe and America, such as vertical cooperation led by upstream retail enterprises (supermarket chains, e-commerce, etc.), hoping to overturn the traditional circulation system dominated by wholesale market to solve the problem thoroughly, but the result is far less than expected. This means that people underestimate the competitive advantages of china wholesale sourcing system under China's national conditions. It is these advantages that give the wholesale market great vitality.

Specifically, china wholesale sourcing will still play its price formation function, signal transmission function and logistics node function in the national market, but the function of gathering a large number of small-scale suppliers to display and sell to the retail end will be impacted with the development of other circulation modes. The business model of wholesale market based on booth system will face adjustment.