Huaqiang North America’s cosmetics transformation suffered a setback. Thousands of stores were evacuated overnight, and 98% of beauty stalls were temporarily closed.

Text丨AI Finance and Economics Society Ren Xiaonan

Editor丨Chen Fang

Huaqiang North America Cosmetics City, which has grown crazily, was suddenly poured cold water on it.

Recently, some netizens discovered that thousands of shops and businesses in the Beauty City located in Huaqiangbei Commercial District, Futian District, Shenzhen have evacuated overnight. The once bustling shopping mall is now unusually empty.

"Due to special circumstances recently, the merchants in the Beauty City have been closed for rest, and the waiting time is about 3-4 days, maybe more." A staff member from the Investment Promotion Office of Mingtong Beauty City told AI Finance. Another beauty merchant said that currently only a few businesses are open and have a few products on display. "Recently, due to special circumstances, the merchants in the Beauty City have been closed for rest, and the waiting time is about 3-4 days, maybe more." A staff member from the Investment Promotion Office of Mingtong Digital City told AI Finance. Another beauty merchant said that currently only a few businesses are open and have a few products on display.

The cause of the incident was that at the end of 2020, CCTV Financial Channel reported a large-scale beauty smuggling case in Huaqiangbei, Shenzhen. In this case, 4 smuggling gangs were eliminated, 36 suspects were arrested, and the amount involved was as high as 6 billion, and the items involved include internationally renowned cosmetics such as Estee Lauder and Lanc?me. In January this year, the Shenzhen government required beauty stores to keep sales, purchase and shipment records.

In accordance with the unified deployment of the Anti-smuggling Bureau of the General Administration of Customs, the Customs Anti-smuggling Department and the local police jointly launched a major inspection of the Huaqiang North American cosmetics field. Currently, nearly a thousand cosmetics stores have moved away overnight and suspended shipments.

Avoid the limelight under special circumstances

"Notice to inform that due to the special circumstances of these two days, all goods will not be shipped out of the warehouse and will not be shipped. The resumption of delivery time will be notified. During special periods, Thank you for your understanding!” On January 5, a beauty stall merchant in Huaqiangbei posted on Moments and mentioned that he had a day off.

It is understood that since the Market Supervision Bureau, Public Security and other relevant departments jointly launched a major inspection on smuggling, counterfeit sales, tax evasion and other behaviors at Huaqiangbei cosmetics stalls, the entire Mingtong has been closed since January 4. In a state of closure for reorganization. A media visit found that, in addition to Mingtong, 98% of the stalls in beauty malls in the Huaqiangbei business district such as Manha, Wanmei, and Women's World were closed.

When asked when they can reopen, another merchant said that he was not sure, but he would not recover so soon. "There is a lot of noise during this period, so we need to avoid the limelight. You can place orders online today and ship normally."

Due to the recent closure of physical stores for rectification, the merchant no longer publishes products on Moments as before. Pictures and prices are in the form of notes, and due to channel conditions, daily product prices will fluctuate. "Every day or even a few hours later, some prices will change. What we earn is channel money. We only earn a few yuan per order. Hoarding goods will increase our risks."

From his circle of friends It is not difficult to see from the price list that each item is priced lower than half the market price. However, the too-low price also causes many people to doubt the authenticity of the product. "It supports changing the sender's address, and merchants generally fill in Luohu Port when shipping." said an industry insider. And according to this person, some of the overseas cosmetics flowing into Huaqiangbei were taken from Hainan duty-free shops, and some were taken from "smugglers".

In September last year, a delivery man pulling a trolley in Huaqiangbei revealed to AI Finance and Economics, "A big boss has just been arrested, and the superiors are strictly investigating and arresting people. Now the news is very tight." "I usually bring some health products and medicines and deliver them two or three times a week." And the person reminded that the beauty store is a mixed bag, and many merchants mix genuine and fake products, so you must pay more attention when purchasing goods.

From Electronic City to Beauty City, the change of track is crucial, but the biggest problem currently plaguing Huaqiangbei is changing the label memory. The beauty mall launched through vigorous innovation has been criticized for frequent counterfeit goods. Some customers even reported that when it came to the products they purchased, the authorities did not recognize that the goods were flowing out through their own formal channels, nor did they inspect the goods. Coupled with the negative impression of "copycat phones" in the mobile phone era, these have become a fetter for Huaqiangbei's transformation.

The managers of Huaqiangbei are well aware of this and are taking measures step by step.

In the buildings that have opened such as Mingtong and Manha, signs saying "If you leave a fake will be punished by ten" signs are posted everywhere, as well as a business responsibility letter with the shop owner's handprint. Recently, major shopping malls are being transformed into beauty malls, and market regulators have also stepped up supervision. Recently, there have been reports of captures of smugglers, which has silenced the entire market. The above-mentioned insider revealed.

Beauty business in Huaqiangbei

"There are still no vacant stalls and no one has vacated them." A staff member from the marketing department of Mingtong Digital City replied to AI Finance.

At the end of 2018, the information that Huaqiangbei has a beauty city began to gradually become known. Nowadays, advertisements released by stall merchants can also be seen on Douyin, Xianyu and other channels.

The monthly rent for a 10-square-meter stall on the first floor of Mingtong is between 60,000 and 80,000 yuan, and you need to pay half a year first and then two months as a deposit, plus 2-3 people employed in the store. Employees, the cost of each store is at least 500,000 yuan. In addition to high rents, the transfer fees for Mingtong Cyber ??City shop stalls have also been raised to more than 1 million yuan.

But even in the face of intensified supervision, AI Financial News consulted the investment promotion offices of multiple shopping malls, and they all said that there are still no stores that can be transferred. "Just wait until it reopens, and you can still sell online now." "Goods", Huaqiangbei's beauty business is still favored by merchants. E-commerce and purchasing agents are the main distribution channels for these cosmetics. According to the stall staff, they will cooperate with some e-commerce stores to provide them with supply, and will also open live broadcast channels in the future.

Note: Mingtong Cosmetics Market, buyers in front of the store

Compared with the previous mining machines and e-cigarettes, the Beauty City is the most successfully transformed in Huaqiangbei A section. The market opens at 2 p.m., and at 1 or 2 p.m., there is an endless stream of customers in front of the stores in the beauty city. There is no need for trial or recommendation here. The price difference between each store is between 5-10 yuan. Buyers only need to tell the merchant their list of goods. “Orders of hundreds of thousands or millions are common,” said a merchant.

However, in Huaqiang North America Cosmetics City, most merchants are not familiar with the products they sell. They only know the category names and prices. When consumers ask about product performance and related combinations, only a few merchants Can answer. For them, they only need to know that this is a kind of goods that is circulated through channels. It is enough that there is market demand, and the rest is not important.

In the Mingtong Cosmetics Market, in order to facilitate merchants, the building has specially customized a "Mingtong Find Products" applet, in which merchant information, product details and prices are clear at a glance. Bauhinia City and Manha Commercial Plaza is also promoting a customized mini program with market quotation function - Xiaozhu Finds Goods.

The renovation of Mingtong Beauty City has been completed, and the huge electronic light signs and landmarks of Mingtong Digital City are still visible. Manha Digital Plaza, Yuanwang Communication Accessories City, Longsheng Accessories City and other signboards have not yet been taken off. It is not difficult to see that major commercial buildings have only decided to transform their beauty malls in a short period of time, and the traces of the once glorious mobile phone era are still there.

Whether it is getting rich and rising, changing careers and leaving, or sticking to it and trying boldly, Huaqiangbei has experienced too many ups and downs, and the joys and sorrows of businessmen. Transformation is undoubtedly a difficult problem for any enterprise, especially in business districts like Huaqiangbei where the impression is more obvious.

The electronic era has passed, but Huaqiangbei is unwilling to call time on its business. In a new round of replacement, the beauty industry with a trillion-dollar market will create a new era for Huaqiangbei, but whether the memory of the era of fakes can be eradicated may be the key to the success or failure of Huaqiangbei.