Barry Li’s Q&A session at the Australia-China E-commerce Forum

Event background

This forum, jointly run by Macquarie University and the Chinese Academy of Social Sciences (CASS), aims to provide a platform for industry practitioners, and Australian and Chinese academic scholars, and to demonstrate thought leadership through the mutual exchange of innovative ideas and practical recommendations for the future of trade between China and Australia.

The forum will examine contemporary issues related to international trade and e-commerce in view of the impact of technology and global geopolitical developments. A series of topics will be covered, including: environment finance and professional services in free-trade areas, international business relations between Australia and China, blockchain technology, accounting and finance for cross-border e-commerce, international logistics and supply chain management, and other interdisciplinary themes.

Questions for panel 2 (Micro) for Jonathan Wang (Alibaba) and Barry Li (Author)
1. In analysing the use of e-commerce platforms for cross-border purchase, 84% of consumers used domestic e-commerce platform. Judging from the massive amount of tourists, and also the development of in-house platforms, how do you see the trend of C2C, or Daigou, in cross-border e-commerce? Will it affect the more traditional B2C purchases? (both)

Barry Li: first, I found it is fascinating that we are discussing “e-commerce” here today. When I first heard this concept, it was in 2000 when I started university. Back then, e-commerce was a brand new concept. Back then, it meant that you should email people about your commerce, not sending fax or writing letters. It has evolved incredibly over the past 18 years. So I believe today, we should stop using the concept “e-commerce”, just because everyone is using email and much more. It’s just commerce. Commerce can’t exist today without technology. New technologies around commerce, e.g. mobile payment are now available even in remote villages in China, thanks to innovative business – like Alibaba. Now, back to the question – would C2C affect B2C? Of course, it will. It already did. These are ancient terms as well, big ten years ago. Today we mostly talk about P2P (peer-to-peer) and O2O (online-to-offline). A translation for this question would be: why are business increasingly impacted/interrupted by individuals? (like Daigou) The answer is, innovative companies like Alibaba has changed the game. They have provided individuals (including Daigous) amazing infrastructures and tools to enable/empower then to interrupt traditional business. These infrastructures include communication technologies (e.g. WEChat), transaction platforms (e.g. Taobao), payment systems (e.g. Alipay) and easy global logistics and fulfilment systems. Traditional B2Cs have two options. They can either ignore these new infrastructures and lose the competition, or they can get embrace this change and utilise these new infrastructure built by innovators, and continue their success.

2. We understand that the highest proportion of Products that online shoppers buy through Haitao are: Fashion (22%), beauty and cosmetics (20%), grocery (19%), sports and leisure products (18%). Why do you think this is the case and do you think Australia has a comparative advantage over these products? (Barry Li)

Barry Li: Sadly, I know nothing about fashion, nor beauty and cosmetics. I don’t have any figure, but I heard Japanese beauty and cosmetics products are more popular in China. I’m not familiar with sport and leisure products either, as this is my audit busy season I have pretty much no time for sports and leisure. I do believe Australia has excellent comparative advantage over some mineral resources and some agriculture products, but I don’t think the comparative advantage is a pre-requisite for transactions of goods. Sometimes, it is about choices and diversity. As China’s mid-class population grow, they want to try things from other countries, and they don’t even have to be better. They need to be exotic. Chinese people always prefer Chinese food, even for those who have lived overseas for decades. However, no one mind having burgers from time to time, because that it’s good to have a different flavour now and then.

3. Barry, in your book you impress us that Chinese consumers are changing Australia’s culture, not only in e-commerce. How is it so and would you like to comment on the behaviours of Chinese consumers that tend to be different from Australian or western consumers for e-commerce? What might be the next big thing for e-commerce?

Barry: That sounds like a false impression you got there “Chinese consumers are changing Australia’s culture”. I have never implied that in my book. It is tough to discuss Chinese consumer’s behaviour within a few minutes. It’s not one Chinese consumer, but 1.5 billion Chinese consumers and everyone behave differently according to their income/wealth/age/profession/location and a million other factors. You are asking what the next big thing for e-commerce is? This is the answer – big data. Before we had big data, we had to category consumers into a few very inaccurate categories to analyse their behaviour. But with today’s technology, especially the big data like Alibaba has collected, we can almost have a tailored experience for every consumer. Example, my login to Taobao shop would look completely different from my wife’s login. The first screen we see, and the recommended products would be based on our private data, which hopefully are secure, and not shared with other people for other purposes. However, it is not really the next big thing, it is happening today in China. In Australia, we have strict laws on how data are collected and used. So it will be the next big thing in Australia.

Does leadership have a nationality?

This is a speech delivered by Barry Li on the 20th of June 2018 at the China and Australia Culture Exchange Centre opening lunch.

Hello everyone. I’m invited by my colleague/friend Selena today to this lunch event, to talk about leadership and nationality. Today is also the opening day for Selena’s China and Australia Culture Exchange Centre. She also invited me to serve as the president of the club. I’m a very busy person, so I initially said no to both the president tile and the speech, but then she mentioned that she would buy me this lunch. I certainly wouldn’t say no to a free meal. So I’m here. And then she asked me for ideas for promotion of this event. To repay this free lunch, I offered to donate ten copies of my book to the China and Australia Culture Exchange Centre. That is about $300 market price. So overall I made a significant loss. That further proves the old saying – “there’s no such thing as a free lunch”. Therefore, I highly encourage everyone to pay for their lunch today; even Selena offers otherwise.

Jokes aside, food is getting cold so let’s go straight into the topic. Does leadership have a nationality? My answer is simple. YES. That concludes my speech, thank you, everyone. Now let’s dig in.

OK, that’s another joke. I’m going to talk about the difference in leadership by nationality. I don’t think I have the qualification to speak about leadership and nationalities all around the world, but I’m happy to present my view on the difference between Australian leadership and Chinese leadership. I’m going to talk based on both my book and some of my observations that I decided not to include in my book. Because I don’t want my book to become a banned book in China. I still need to go back there from time to time for the real Chinese food.

The way I see the difference between Australian leadership and Chinese leadership is the number of choices the leader offers. Let me give you one example. This is the menu of this restaurant. There are quite a lot of options for $15 dish including drink. Good value for money. But more important than the good value for money is the diversity of dishes you can choose. You can select the butter chicken, which is relatively small portion by the way. You may not be happy with your choice when you see the actual dish, but you won’t blame anyone, because you chose it yourself. You were given the options to choose whatever you like. This has been the case in Australia for probably most of the past 100 years. But during some part of that same period in China, the only choice most people had, was either to take whatever food there is or not eat.

Now let’s move on to leadership in business because I never talk about politics. Some old-style Chinese business leaders they are used to offer one item on the menu for their followers – “Do this”. “Get this done asap”. This is the way they got used to, and they expect the young generation to follow. This is like offering only one dish on this menu and ask everyone to choose the same dish. This is unfortunately not going to work well in the 21st century, even in China.

So would an excellent Australian leader do today? Like my boss, they would go: “Barry we need to solve this problem. We used to do this, but can you think of some better options?” I was suddenly empowered with the ability to explore options! Then, of course, I would actively search and find a better way to do the same task. But the trick is, in most cases, there is still just this one only way the problem can be solved. But I was not directed to do it; instead, I explored options then “decide” to do it. In order words, I spend more time doing the same thing. Then I go to my boss and say “I think we should do this”. Then my boss can say: “Cool. Let’s do this then. I know you are busy, but the deadline is next Monday. Don’t stay late, feel free to do it anytime that suits you”. This is called flexible hours. I was given the option to work whenever suits me. Great isn’t it? The trick is, I’m not working any less, but I’m happy with the flexibility because I was given a choice to do it when the kids are asleep, or on the weekend. If I work in a petrol shop, I will get penalty rates. I’m not, but I’m still happy because I have the menu. Working on the weekend is MY choice.

Now I think you can all see the difference between the two types of leadership styles I mentioned. I’m not going to say which one is better. In many cases, not having too many choices is a good thing. When I go into a busy Westfield car park, I prefer to have this only perfect spot available just for me. When there are too many parking spots, I end up with thinking that I didn’t park at the best one. Stupid isn’t it? That was a reason that my 20s were a big failure. I spent too much time explore the options and end up not focusing enough. And that is why today, after five years, I’m still doing Audit.

In conclusion, one of the big difference between Australian and Chinese leadership style is the options the leader give to people. We all like the power to choose. But I can’t say a choice is better than no choice. Since we have all chose our dish today, let’s dish in with no complaint. And remember, there’s no such thing as a free lunch.

HOW TO SELL TO CHINESE CONSUMERS: THREE TIPS

By Barry Li


Last year, one of my colleagues built two semi-detached houses, wanting to sell one. His question to me was: How do I sell it to a Chinese buyer? There’s an implied understanding in that question that Chinese buyers will pay a premium to acquire a property.

Besides possible higher premiums, the other reason to target Chinese consumers is that it can help your business expand to a larger market .

View full post at dynamicbusiness.com.au

How did China become so ‘hot’?

By Barry Li

Anyone who has visited the country recently knows the growth in China is real, and very visible. In 1950 some 544 million people lived mostly in villages; by 2015, the population had ballooned to 1.38 billion people, with 56 per cent living in cities. The scale of construction being carried out to accommodate this population growth is stunning. Besides housing, the new population needs food, clothing, transport, services and entertainment. The supply of every household product to its own population alone would make China the largest market by volume in the world.

View full post at kochiesbusinessbuilders.com.au

Selling to the Chinese: leveraging the “One Child Policy” effect

By Barry Li

Most Australians are familiar with China’s “one child policy”. Enforced around the time of my birth in China three and a half decades ago, this policy evolved into a “two child policy” just a couple of years ago in response to China’s aging population. The policy has been criticised by the Western world since the day it started and likely hated by many Chinese families who’d prefer to have multiple kids. What Australians may not be aware of is that the consequences occurring because of this policy has resulted in the boom of many Australian industries.

View full post at openforum.com.au

The political sensitivities that should be observed when doing business with China

By Barry Li

There was news recently that a lecturer from Monash University had unintentionally offended Chinese students with a question regarding Chinese stereotypes in a course quiz. Following university inquiries, the lecturer was suspended and Monash has since removed the popular textbook (Human Resources Management by Raymond J. Stone) while apologising to the incensed Chinese community. The business school textbook quoted outdated information about Chinese government officials and skilled labours, resulting in Chinese international students feeling humiliated.  While I personally believe that some may have overacted to the inappropriate question, the textbook – despite being republished in its 9th edition this year – clearly needs its contents revised and updated; universities and lecturers from this experience should enhance their awareness of political sensitivities while doing business with China, and this very much includes when teaching Chinese international students.

View full post at onlineopinion.com.au

How to Sell to the Chinese Market

By Barry Li

In the big, fast-moving consumer goods company my wife works for, management devotes a lot of energy to their China strategy. Last year one of their products, a mosquito repellent for children, sold really well in China through Diagous (Chinese shopping agents). This year they produced more of the same product specifically for the Chinese market, and thoughtfully added labels with Chinese information. To their great surprise, the product did not sell as well.

View full post at kochiesbusinessbuilders.com.au 

An insider’s view on Chinese buyers

In 2013 my wife and I were looking to buy our first home – something bigger in a nice suburb with a good school nearby. During the inspection for a three-bedroom unit in Killara I said to my wife “Wow, look at this, there’s no other Chinese buyers here. I think we can get this one!” And indeed, we did.

Unlike those cash-loaded, overseas Chinese buyers you see at property auctions, my wife and I are new migrants living on monthly Australian salaries. In addition to the normal frustration of being defeated at auctions by the super-rich Chinese, we also suffer from the common criticism today that “the Chinese” have and are pushing up property prices in Australia. I can’t blame people who put it that way because, the truth is, Chinese home buyers have lots to do with the property market in Australia…

View full post at onlineopinion.com.au

 

Brave young Chinese ‘briber’ should be commended

By Barry Li

Two weeks ago, a Chinese international student running for election on the University of Sydney Union board was disqualified for bribery and graffiti painting on campus walls. My initial reaction was of pity. No one taught this poor girl how to run a proper election campaign. How could she know any better? Chinese politics are not based on elections. It was great she tried; it was not a surprise she failed. I thought that was the end of the story.. [Read more]