Many foreign trade enterprises are optimistic about the potential of the domestic market, shifting from exports to domestic sales to promote "dual circulation".

Affected by the epidemic, China's foreign trade development faces huge challenges. While continuing to explore international markets, many foreign trade enterprises generally recognize the potential of the domestic market and have begun to introduce marketable export products into the domestic market. From central to local governments, a series of policies to help foreign trade enterprises expand into the domestic market have been successively introduced and implemented. How is the situation of enterprises shifting from export to domestic sales? What hurdles still need to be overcome? Reporters interviewed relevant enterprises and experts.

　　Procedures——

　　Simplify product certification, accelerate market access

　　"If there were no domestic sales market, it would be difficult for us to survive this year," said Chen Cuihong, General Manager of Shuangma Plastic Industry Co., Ltd. "We plan to develop more products suitable for the domestic market."

　　As a kitchen plastic products manufacturer that has been deeply involved in the foreign trade market for more than 10 years, the sudden COVID-19 pandemic brought Shuangma Plastic Industry an unprecedented crisis. Recalling it, Chen Cuihong still has lingering fears: "During that time, I didn't sleep well for a single day, wondering what to do with so many orders that couldn't be delivered. When we resumed work and production, we immediately went full throttle to produce overtime, but then many overseas orders were cancelled, and the finished goods piled up in the factory, unable to be shipped out."

　　The sluggish foreign market, upon reflection, revealed new business opportunities. During the epidemic prevention and control period, a large number of domestic consumers stayed at home to study cooking, and many bought vegetable processors, onion choppers, and shredders online, making the previously inconspicuous domestic sales market suddenly stand out. Seizing the opportunity, Shuangma Plastic Industry immediately adjusted its business strategy, shifting its marketing focus to expanding the domestic sales market.

　　"We are tackling both online and offline, and it seems to be working wonderfully now," said Chen Cuihong. The goods accumulated due to cancelled foreign orders are selling rapidly in the domestic market, and the monthly sales in the domestic market have now exceeded 10 million yuan.

　　Zhao Ping, Director of the International Trade Research Department at the China Council for the Promotion of International Trade (CCPIT) Academy, believes that against the backdrop of shrinking international demand, China's advantage of a super-large market provides vast space for foreign trade enterprises to shift from export to domestic sales. In turn, more high-quality export products transitioning to domestic sales will enrich the domestic market supply and further stimulate domestic market vitality and effective demand.

　　However, for some foreign trade enterprises, entering the domestic market first means facing the challenge of differing quality standards and certifications between domestic and international markets. To support the shift of marketable export products to domestic sales, the General Office of the State Council issued the "Guiding Opinions on Supporting the Transition of Export Products to Domestic Sales," clearly stating the need to simplify certification procedures for domestic sales products and accelerate market access for such transitions.

　　A relevant official from the State Administration for Market Regulation stated that they will further optimize certification procedures. For products that have already obtained international or foreign certification, on the premise of meeting CCC certification requirements, existing testing and certification results will be actively recognized to avoid repeated evaluations and shorten the processing time for certification.

　　Zhao Ping stated that supporting the transition of export products to domestic sales, in the short term, is an emergency measure to help foreign trade enterprises solve the problem of domestic sales and promote stable foreign trade development. In the long term, it is also a lasting way to connect the domestic and international markets and two types of resources, promote the mutual reinforcement of domestic and international dual circulation, and cultivate new advantages in participating in international cooperation and competition.

　　Channels——

　　Leveraging e-commerce platforms to facilitate supply-demand matching

　　"The 100,000 ukuleles originally destined for export are almost sold out," said Du Shaodong, head of Jingxi Enbao Toy Group Buying Flagship Store, happily. The company not only launched its store online but also utilized platform big data to customize a children's toy car based on consumer preferences, selling 20,000 units within half a month of its launch.

　　"I hadn't thought about domestic sales before," Du Shaodong admitted. The company had been in the toy export business for over a decade, with stable orders and sales channels. The export process was simple, requiring only a few overseas agents for normal operation, and the company was only responsible for production according to orders. However, domestic sales are different; channels, operations, and after-sales service all need to be handled internally, requiring a lot of effort and time.

　　Many foreign trade enterprises found it difficult to smoothly open up the domestic market due to a lack of understanding of market demand, insufficient marketing experience, and low brand awareness.

　　Fortunately, Du Shaodong found help. This year, Jingxi, the social e-commerce platform under JD.com, launched the "Direct-from-Factory Quality Products from Industrial Belts" program, assisting foreign trade enterprises in building an efficient online sales system.

　　With one-on-one assistance from the platform team, from category selection and product pricing to store operations, Du Shaodong quickly launched his store. After two months of exploration, it is now on track, with average daily orders in June growing 17 times compared to April.

　　Liu Hui, Chief Data Officer of JD Big Data Research Institute, stated that e-commerce platforms have advantages in big data, supply chain, and marketing, which can help foreign trade enterprises quickly understand market demand and establish channels for domestic sales. At the same time, new models and business forms such as live streaming sales, community e-commerce, and C2M (Consumer-to-Manufacturer) have strengthened the two-way connection between enterprises and consumers, allowing high-quality export goods to quickly enter the domestic market and win consumer trust.

　　To help foreign trade enterprises smooth out sales channels, various regions have introduced policies based on their actual conditions. Shanghai proposed encouraging e-commerce platforms to offer preferential policies such as zero commissions, traffic support, and reduced deposits, and actively organize offline special sales exhibitions. Major e-commerce platforms have also set up special zones and dedicated events for export products. On June 24, Suning Pingo officially launched a "Helping Export Enterprises Transform" special zone; on July 2, Taobao Tejia Ban (Lite) officially launched its foreign trade channel, creating exclusive sales channels for 300,000 foreign trade factories on its platform.

　　Li Danghui, Deputy Director-General of the Department of Consumer Promotion at the Ministry of Commerce, stated that in the next step, the Ministry of Commerce will organize nationwide consumer promotion activities, utilizing the advantages of pedestrian streets and key business districts in terms of brand concentration, channel integration, and market popularity to broaden domestic sales channels for marketable export products; it will also guide and support local governments in building consumer promotion platforms to help foreign trade enterprises further connect with large domestic commercial circulation enterprises and e-commerce platform enterprises, promoting supply-demand matching.

　　Costs——

　　Introduce preferential policies to alleviate financial pressure

　　"Thanks to the customs' simplified procedures for domestic sales of finished products from processing trade imported materials, we quickly seized market opportunities and achieved the shift from export to domestic sales," said He Han, head of Shenzhen Biwin Storage Technology Co., Ltd. In the first half of this year, the value of the company's processing trade converted to domestic sales reached 120 million yuan, a year-on-year increase of 1.4 times.

　　To support the development of processing trade enterprises and promote the transformation of processing trade from simply "both ends abroad" to "two types of resources, two markets," Shenzhen Customs recently specifically introduced 12 measures to facilitate domestic sales: simplifying business procedures such as outsourced processing and handbook (account book) verification, simplifying various domestic sales documentation, and providing pre-ruling services such as classification, which greatly improved the overall efficiency of enterprises handling domestic sales business.

　　Currently, China's main foreign trade forms are general trade and processing trade. Enterprises engaged in general trade are relatively familiar with the domestic market, and the pressure of switching between domestic and international markets is smaller. For processing trade enterprises, however, shifting to domestic sales is more difficult. Whether it's processing with supplied materials or processing with imported materials, processing trade enterprises often have "both ends abroad" for raw materials and finished products, lacking the foundation and experience to operate in the domestic market, making the transition to the domestic market very challenging.

　　Since the beginning of this year, various policies, including financial and tax support, have been introduced to create a favorable environment for foreign trade enterprises to shift their exports to domestic sales. On April 15, the Ministry of Finance, in conjunction with multiple departments, introduced two tax preferential policies: temporarily exempting processing trade enterprises from paying taxes and interest on deferred taxes for domestic sales, until the end of the year; and expanding the pilot program for selective collection of tariffs on domestic sales. Li Xingqian, Director of the Foreign Trade Department of the Ministry of Commerce, stated: "When processing trade enterprises sell imported materials or finished products domestically, in addition to paying import taxes as stipulated, they also need to pay interest on deferred taxes. Temporarily exempting processing trade enterprises from paying interest on deferred taxes for domestic sales can reduce domestic sales costs and alleviate the financial pressure on enterprises."

　　The General Administration of Customs stated that it will further relax the time limit for domestic sales taxation, changing from monthly reporting to a maximum of quarterly reporting, and allowing eligible enterprises to report within 15 days after the end of each quarter. Lin Shaobin, Deputy Director of the Enterprise Management and Inspection Department of the General Administration of Customs, stated that this will significantly reduce the number of times processing trade enterprises handle domestic sales procedures, greatly saving the cost of handling domestic sales business for enterprises, and improving efficiency.