I was privileged to get to organize Food from Finland China Roadshow with the Team Finland this September. The roadshow was composed of dedicated online sustainable agriculture and food conference, and meet-the-buyer meetings which enabled Finnish companies to connect with local buyers and media.
With almost 2000 viewers including 30 Chinese media and multiple industry professionals participating the roadshow livestream, thirteen leading Finnish food and beverage companies broke through the barriers of time and space to introduce Finnish offerings as well as the best practices followed by speeches from Ministry of Agriculture and Forestry, Embassy of Finland to China, MTK and Chinese expert in sustainable food field. The Finnish brands were able to proactively tap into China market under sustainability theme while the Chinese industry audience showed confidence and interest in diverse and high-quality Finnish food sustainable offerings and practices.
Why sustainability became the topic for the roadshow and why did it interest Chinese audience? What are the current trendy categories under healthy and sustainable food concept or the trendy channels with easy entry to China? Here are my market tips to China.
Like in other countries, Chinese consumers are concerned about pollution, waste, and the environment. Changing attitudes are a major reason why sustainability has risen in the agenda in China. When thinking about what defines sustainable food, Chinese consumers point to factors such as high-quality, transparent supply chain, pure ingredients and origins, functionality, safety and healthiness.
Healthier food and beverage are becoming core drivers, when people are looking for keywords like "low fat" and "low sugar", and "0 fat", "0 sugar" or "0 calories". Consumers are now showing an increased willingness to pay premium prices for products that are considered healthy and functional. The push for healthy products is not just among snacks and beverages, but also for instant or ready-to-eat meals or meal replacement products as well as protein bars milkshakes. Some Chinese consumers look really closely at the food and ingredient labels prior to purchase.
Plant-based products like milk alternatives have stepped into the spotlight in China, as more Chinese consumers become familiar with products such as oat milk, almond milk and rice milk. Chinese consumers also expand their view on soy milk, a traditionally popular beverage in China, to be more than a simple breakfast item. Although the market in China is large, Finnish companies need to face challenges that come with China's history of eating soy alternatives to meat.
Therefore, companies need to continue to conduct market education to differentiate themselves, while also understanding under which circumstances plant-based meat alternatives are most likely to be consumed. Some of the top identified consumption scenarios include hot pot, Chinese-style barbecue, snacks, and ready-to-eat or ready-to-cook food.
China has the largest digital buyer population in the world: more than 840 million online shoppers! In 2021, China's e-commerce market was larger than the US, the UK, Japan, Germany and France combined, and in 2021, e-commerce sales reached 52 % of total retail sales, making China the first country in the world to have more online sales than traditional ones.
Cross-border e-commerce could be a good place to start, if you interested in China, but not ready to establish a presence in the country yet. Instead of establishing a presence in China to sell online, Finnish companies can choose cross-border e-commerce, benefitting from streamlined customs procedures through over 100 cross-border e-commerce-integrated pilot zones.
The current cross-border e-commerce regime permits overseas sellers to sell goods directly to Chinese consumers through certain registered e-commerce platforms (e.g., Tmall Global, JD.com). The qualifying products can be imported on an expedited basis at reduced import tax rates. The products are either shipped from overseas or stored in a bonded warehouse.
As the retail gets more digitalized, the penetration rate of fresh food e-commerce has also been increasing and online channel plays a much larger role. Fresh food e-commerce transaction volume reached 182.12 billion yuan in the first half of 2020, a year-on-year increase of 137.6 %, which has exceeded the entire year of 2019.
Platforms like fresh Alibaba's Freshippo, Dingdong.com, Chunbo.com are the new retail model O2O (online to offline) which turn normal grocery purchase to a digital experience.
There is added value for Finnish brands jointly presented in China with larger impact under country image which government endorsement are well recognized in China. Keep tuned on the Team Finland (Food from Finland, Business Finland China, Embassy/Consulate, Ruokavirasto/Finnish Food Authority) actions, feel free to reach us and find your supporting Finnish community for China.
Want to dive deeper? Please check out the latest webinars about China from Food from Finland website.
To succeed in China, you need to be aware that it's going to take time, investment, and commitment. Finnish brands have good image – with careful investigation and with our advice you will get the keys to open the doors.