Guangxi businesses take advantage of SEA proximity
By Kristine Lim 2010-10-31 10:20:02
GUANGXI, China: A wholesale market in China's southwest Guangxi province is taking full advantage of its 
geography.
Being close to its customers in southeast Asia has helped businesses save at least 20 per cent in shipment and other costs.
The wholesale market specialises in hotel supplies, from intricate wine glasses and ornaments to towels and blankets.
The 100,000 square metre market is also one of its kind in Guangxi.
Its close proximity to Vietnam, and a well developed rail and road infrastructure, makes it a good platform for entering the ASEAN market.
A number of companies, originally located in neighbouring Guangzhou, have also moved to Guangxi to set up shop.
Liu Juan, a hotel supplies company manager, said: "We have always had quite a lot of customers from Vietnam, even when our base was in Guangzhou.
"Previously we had to first transport the goods to Guangzhou then Vietnam via Guangxi.
"By setting up shop here, we ship there directly, saving a lot. Customers can also come here personally to see the samples".
The local government also provides free promotion and tax incentives, helping businesses save more.
Another hotel supplies company manager, Edward Chay, said: "... for example, (when) doing promotions and advertisements, we can exclude those costs and tax.
Mr Chay added tariff on products used to be 17 per cent but now "it's zero tariff."
Business has improved, since the warehouse started operating last year.
Shop owners expect to break even within the next two years.
And more companies - including one Singapore firm - will join by the end of the year, under the second phase of development.
Since the China- ASEAN free trade agreement came into effect this year, trade between Guangxi and ASEAN has reached $3.11billion dollars - a 40 per cent increase over the same period last year.
geography.Being close to its customers in southeast Asia has helped businesses save at least 20 per cent in shipment and other costs.
The wholesale market specialises in hotel supplies, from intricate wine glasses and ornaments to towels and blankets.
The 100,000 square metre market is also one of its kind in Guangxi.
Its close proximity to Vietnam, and a well developed rail and road infrastructure, makes it a good platform for entering the ASEAN market.
A number of companies, originally located in neighbouring Guangzhou, have also moved to Guangxi to set up shop.
Liu Juan, a hotel supplies company manager, said: "We have always had quite a lot of customers from Vietnam, even when our base was in Guangzhou.
"Previously we had to first transport the goods to Guangzhou then Vietnam via Guangxi.
"By setting up shop here, we ship there directly, saving a lot. Customers can also come here personally to see the samples".
The local government also provides free promotion and tax incentives, helping businesses save more.
Another hotel supplies company manager, Edward Chay, said: "... for example, (when) doing promotions and advertisements, we can exclude those costs and tax.
Mr Chay added tariff on products used to be 17 per cent but now "it's zero tariff."
Business has improved, since the warehouse started operating last year.
Shop owners expect to break even within the next two years.
And more companies - including one Singapore firm - will join by the end of the year, under the second phase of development.
Since the China- ASEAN free trade agreement came into effect this year, trade between Guangxi and ASEAN has reached $3.11billion dollars - a 40 per cent increase over the same period last year.
From channelnewsasia.com