Bloomberg: China’s Daigou Get Grounded By Pandemic

The army of gray-market surrogate shoppers, or daigou, has long been a feature of China’s retail sector, serving consumers who crave items that aren’t available locally or are sometimes significantly more expensive in the country. Now Covid-19 puts a halt to most overseas travel – and the business of daigou operators.

Companies that counted on daigou sales are now saddled with excess inventory. “Daigou is unlikely to reach its heyday market size anymore even after the pandemic eases,” says Ethan Ye, a principal in Shanghai for consultants Oliver Wyman. Chinese government has tightened regulation in this grey market, and simultaneously launched supportive policies to encourage legitimate shopping channels. More importantly, oversea brands have determined to take more active management on China business.

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