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A growing number of Chinese e-commerce merchants are selling their products on Russia's largest online marketplaces, as exporters increasingly look to platforms to find new markets and avoid Western tariffs.
Ozon Global, the international version of one of the largest companies in Russia E-commerce Sourcing 80 per cent of its orders from its online platforms, it told the Financial Times it had registered at least 100,000 sellers from the country. In 2022, the number of Chinese sellers reached about 10,000. Wildberry, the largest platform by sales, said it officially launched a channel for Chinese sellers last year, with industry sources confirming growing interest in selling on the platform.
Several Chinese suppliers said that in addition to opening accounts on international platforms dedicated to the sites, they were also registering local Russian e-commerce stores — a process that requires opening a Russian bank account, paying for warehouses within the country and receiving payments in rubles.
Chinese suppliers said they were keen to fill the gap left by a decline in international business from Russia after Moscow's large-scale invasion of Ukraine more than two years ago. They added that the country was a source of alternative demand such as Western markets including the European Union and the United States Moved to close lucrative tax loopholes Which boosted the e-commerce industry in China.
“Because it is fair to say that the American and European markets have now been affected (negatively) and because relations between China and Russia are very good, everyone is investing more (in the Russian market),” said Yarong Wuliu, UN Deputy Secretary-General. From the Cross-Border E-Commerce Section of the China Small and Medium Enterprises Association, which helps SMEs hoping to open accounts on Ozone.
China's e-commerce trade grew by 13 percent in the first six months of this year from a year earlier to reach a record high of RMB 1.25 trillion ($175 billion), or 5.9 percent of total imports and exports for the period, according to official figures. E-commerce grew by 15.6 percent in 2023, accounting for 5.7 percent ChinaOfficial figures show that China's total merchandise trade rose from 4.9 percent the previous year and 1 percent in 2015.
Henry Zhao, a law professor at Singapore Management University, said bilateral e-commerce trade is growing rapidly. “On the Chinese side, (it is) the decline in their existing markets such as the United States and the European Union, especially their quest to reduce dependence on China, or even ban some Chinese shopping platforms,” he said. “From the Russian side, China is their only lifeline in light of all these sanctions.”
Wei, an e-commerce merchant in Shenzhen who asked that his full name be withheld, said he opened a consumer electronics store on Ozone Global two years ago as a recent college graduate.
“We only have a market because the United States imposed sanctions on Russia,” he said. “It's very good compared to other platforms. Profit margins are decent… Competition is not fierce.”
However, sellers have complained of difficulties receiving payments in RMB following sanctions imposed on Russia. On occasion, Ozon has prohibited the sale of certain items through its cross-border channel to ensure they meet global legal requirements. But Wei and others said they were able to avoid both problems by opening locally registered stores.
Popular posts on Chinese social media platforms, including the Instagram-like Xiaohongshu, detail the benefits of opening accounts on Ozon's local broadcast. Others advertise services for opening Russian bank accounts and registering local companies. One such account contacted by the Financial Times said they could register a Russian company to run local e-commerce stores for about RMB30,000.
For a higher fee, the company could also try to find a Russian legal representative as nominal head of the company, they said.
The source added that demand for Russian business registrations has been driven by e-commerce merchants, especially Ozon and Wildberry, and has taken off since the beginning of the country's war against Ukraine.
Eason Chen, who runs a Sino-Russian logistics company in Shenzhen, said demand from e-commerce sellers looking to set up local stores is starting to outpace brick-and-mortar business. “All I can say is that (demand) will continue to grow,” he said.
Ozone said overseas sellers account for only 5 percent of its total product range, and it does not support Chinese sellers who import goods to sell in Russian storefronts. She added that all vendors are now receiving payments on time.
Wildberry said it is evaluating the Chinese market “with a limited number of local manufacturers and sellers who can supply their products directly to all countries where the company is present.”
Jin Yang, an e-commerce merchant who sells furniture and home goods, said she opened her Ozone stores in 2022 after three years of selling only on Amazon, hoping to meet unmet demand for everyday goods in Russia.
She said she now earns about 20,000 RMB a month from sales at her stores on the platform, which represents about 30 percent of her e-commerce sales.
While it had also opened two local Ozone stores, it was still “testing the waters” given concerns about converting its profits back into the renminbi, but added that overall demand in Russia was fairly strong.
“China is a manufacturing powerhouse, so we can basically sell them anything they need,” she said.
