To The Moon

World trade has been undergoing a series of changes for some time due to the strategies followed by Chinese manufacturers and companies that are offering ridiculous prices for all kinds of products, from Shein clothing, to consumer electronics, household items, beauty and health, pet products, car accessories, there is no sector that can resist them, and in many cases with free deliveries, of products sent from Chinese ports, more than 10 thousand kilometers away, which that is going to end traditional commerce. We see how, for example, they sell us women’s dresses for 3 euros, shipped free of charge, in what is monumental dumping, illegal although difficult to prove, and scandalous. With these prices, it is impossible to earn even a cent from the sale of a product. Where is the profit then?

The strategy to make money is simple, and lies elsewhere, in capturing the data of the billions of Western consumers on a massive scale. The profit is in the data, so that by using it, we can capture new markets. The profit is in the growth of the market, not so much in the sale of a specific product.

Once the data is available massively, the idea is to flood it with advertising aimed at millions of potential customers.

The problem is that they are showing consumers that it is possible to buy anything at impossible prices, out of all reality, since not even the best managed Chinese companies could maintain these prices if they really played by the same rules as the brands and retailers of the Occidental countries. Furthermore, in this phase of market penetration, they agree to sell millions of times at a loss, which is not only a punishment for the economic sustainability of other areas of the world, but also for the environmental sustainability of the planet, a complete fraud on society.

Once the data is available, the idea is to massively flood it with advertising aimed at millions of potential customers. The price cuts, and the proliferation of bargains bombarding with targeted advertisements, thanks to the data captured, to the billions of mobile phones, tablets and computers, presenting a universe of products at impossible prices, which Western retailers and brands will never be able to equalizing even by lowering their prices in order to be competitive and maintain their market shares is what is leading them to an unprecedented catastrophe, if they continue this dynamic for months.

We are facing a new type of compulsive buying that is difficult to resist. Our phone or our tablet is a true showcase through which all kinds of desirable products parade, products that the vast majority of us do not need, but that remain engraved in our minds with the five prodigious letters: APTCT (Phonetically, the meaning of the letters in Spanish is treat yourself), the total is only 10 euros and we’ll take it home.

In this way, a vicious circle will be created that will destroy entire industries, entire sectors, leading to the bankruptcy of hundreds of large retail chains, and hundreds of thousands of small stores in Europe and other parts of the world. It is something that is already happening, and you only have to look at the number of commercial premises with for sale or rent signs in the center and on the outskirts of the cities, because the old merchants have had to close their stores.

In turn, this scenario of drastic price reductions to be able to compete with the micro-prices of new competitors, will lead to a containment of the worker´s salaries in many companies, if not to a reduction in employment, which will affect consumption, but we must not forget that employees are also consumers when we spend our money earned through work. This is the vicious circle that will lead us to the great deflation of European retail.

We are seeing the growth of business models that insistently fight with the three pillars of sustainability: the environment, contribution to society, and economic profitability in an attempt to eliminate all three. It is exactly the opposite of where we should go to build a better world and society.

The meaningless discounts of online sales, without any control from the European authorities, lead us to catastrophe due to a massive displacement of buyers from retail stores to online stores, without stopping to think for even a moment about what This means the loss of jobs due to direct sales.

But it’s not just that they sell it to us cheap, but they also put it at the door of our house, at no additional cost, which is already devastating to be able to compete. These new ways of shopping are becoming so deeply rooted in our societies, that they are changing not only practically, but also emotionally our lives.

If before, going to the stores to buy was a joyful diversion in which one tried on the items before buying them, looking and looking again to choose between the numerous options, now that is ancient history. Now you go to Amazon, eBay, Shein or Zara and choose the model, style, color and size, and purchase it immediately to have it at home the next day. There you try it on, and if it doesn’t work, you return it and they will refund all the money spent immediately.

And, what do they do with the returns?

Well, auction off the retailer by grouping all the returns to sell them in batches to the highest bidder, so that a businessman makes a ridiculous offer of money for a batch without knowing the value of what it contains and then offers these packages in any location in the world, as in mine: a municipality of 40,000 inhabitants, without the seller knowing what he is selling, and who in turn will resell the pieces of the lot to consumers who will not know what they are buying either until they have paid for it, that is: for one tiny amount of money: 5 euros for example, and when you opened a package it turned out to be a mobile phone, or a drone, or some shoes, or…, whatever it was that you finally purchased. This is the new commercial sales model. It is the simplest formula to “minimize in the strictest sense of the word” losses, and to recover some of the lost money.

When a store appears with this type of sales at a minimum price where you don’t know what you are buying, people go crazy to buy a package because of the sound of what is moving inside, because of the weight or because of any other information that can make the buyer believe that he is buying something valuable. It is the greedy purchase that can turn out well (less often than not) or poorly in most cases, but that everyone likes because it is like a bet that implicitly carries the risk of losing or the glory of winning.

Under these premises, who is the intrepid person who can afford to keep an open business today?

It is not about demanding local protectionism, and it is not about all brands and retailers on European soil playing by the same rules, and that European consumers are the ones who freely choose what they think is convenient to buy. It is about regulating the market in such a way that the survival of all types of commerce is possible, but above all, protecting retail commerce, which is what provides local jobs. It is about the profit margins of these small businesses allowing them to pay decent wages to their workers, because we must not forget that outside of our work we are consumers at the same time, and we are the ones who support local commerce.

I do not want to end this article without leaving some information that allows you to see the size of the problem. In mid-November, the Chinese State Postal Service said it had broken the historical record for postal package shipments, the result of online commerce. The figure exceeded was 120,000 million packages in 11 months, when the previous year 108,300 million packages had been distributed, a growth of 20% annually. The average daily shipments are 300 million packages. The figure is enormous, and it should make us think about whether what we are doing with the current trade model, we are doing well.

Those 120,000 million packages had to be loaded onto a truck in a container to be taken to a port to be loaded onto a ship that would navigate the world’s oceans burning heavy oil for thousands of nautical miles, to unload the containers in a European port to load them onto another truck that would take them to the delivery place from which the vans would leave to deliver the package to its recipient, let’s say 20 days after the package left the factory. All apparently very efficient, but with disastrous consequences thousands of miles away for people and the planet.

We are exhausting the available resources and commerce is being concentrated in very few hands, very powerful, that is, which is generating massive destruction of the global retail trade fabric, enriching a few individually, and impoverishing the rest globally. . This is the final consequence, and we don’t realize it, because what matters to us is that they bring us what we bought from the Chinese for four cents to the door of our house, and the sooner, the better. Pure consumerist fever.

The result is a very complex problem with a very simple solution. The solution is to buy what we need at local retail stores, forgetting about buying from online stores, and especially from large companies. Only in this way would we be able to reverse the situation, and the centers of our cities would gain new commercial life.

El artículo se puede leer en español en este enlace.