A Brazilian buyer sourcing in Yiwu.

South American buyers - particularly from Brazil and Argentina - are making their way to Yiwu, Zhejiang Province, to stock on Christmas gifts. The Yiwu Christmas Gifts Industry Association says exports there have rapidly increased, while overall sales are expected to fall dramatically this year with disappointing take-up in the US, Europe and Russia.

Yiwu is the world's largest exporter of Christmas gifts. Over 50% of gifts offered in the European market come from Yiwu, and this figure is even higher in the US market, estimated as being 70%.

To ensure that Christmas gifts are ready for display on shelves in European and American countries before Christmas, buyers normally arrive in Yiwu from June to September each year.

But this year, overshadowed by the financial crisis, there has been a considerable drop in the number of traditional buyers.

"This year, even if they do buy goods, the quantity bought is negligible," said Liu Yong, a business operator at the Yiwu International Trade City.

Last year, a US client bought over 500 Christmas gifts, but this year the quantity purchased is only about 20, said Liu. "The impact of the financial crisis on the US and Europe is great. As many US and European clients have still not sold out the goods purchased last year, their orders this year are much smaller."

Small and irregular orders for Christmas gifts have become the mainstream in Yiwu this year. "In the past, when US and European clients placed orders, their order size was sometimes over 100 pieces. But this year, these big orders are virtually gone," said businesswoman, Zhou Ailing.

She added that this year clients tend to ask for a few, perhaps just about 10 items of each product. These small orders normally cover a wide range of products but the total number is tiny.

The Yiwu Christmas Gifts Industry Association pointed out that the US and Europe normally account for 70% of total sales. The decline in the US and European markets will lead to at least a 20% drop in total exports.

Merry Christmas in Spanish

While stores from the US and Europe are dragging their feet or have even disappeared, shrewd Yiwu business people have found quite a few "Santa Clause" companies in the Southern Hemisphere willing to splurge.

At Zhou Ailing's shop on the fourth floor of Phase I, Yiwu International Trade City, Christmas balls and wreaths of all sizes and holiday gifts are being assembled.

But unlike previous years, the English words "Merry Christmas" on many of these products have been replaced by the same greetings in Spanish such as "Feliz Navidad".

"As the number of North American clients slipped, we have to find ways to attract clients from South America," said Zhou.

So as from last year, she made use of her free time to go on the Internet to search for information about the cultures and customs of Latin Americans. By doing so, she gained a good knowledge of the festivals in countries such as Brazil, Argentina and Chile as well as the likes and dislikes of the people there.

Zhou also learned some simple Christmas greetings phrases in Spanish and Portuguese. Then she launched different products for Latin American buyers in Yiwu.

These have been well received. Zhou said the number of clients from Brazil and Argentina has risen by 20% to 30% this year, which serves to compensate for the drop in sales caused by the decrease of US and European clients.

According to Huang Yiming, Operator of Yiwu Hangtian Arts and Craft Co Ltd, last year his company sold Christmas gifts to the tune of US$10 million to over 50 countries, with the majority of clients coming from Europe and North America.

But today, Latin America has become his biggest market. His product line has expanded to cover 10,000 items. He expects his company's exports to Latin America this year to rise 30%, with sales of perhaps US$5 million. "Christmas gifts produced by Yiwu are mainly in the medium to low range, which are just right for the Latin American market," said Huang.

Turning Christmas gifts into daily goods

Apart from exploring the South American market, Zhou is also finding ways to turn her products to suit the demands of other countries.

"The majority of Middle Eastern countries don't celebrate Christmas, but we can still sell our products to them," said Zhou. As from this year, she began to play down the Christian element in her Christmas balls and coloured confetti and sell them to clients in the Middle East. They use them as popular decorations for weddings.

Zhou also adds special features to certain traditional Christmas gifts to enhance their practicality, turning such gifts into daily goods.

"This year we developed cuddly comfort pillows with Christmas motifs. While a comfort pillow with the design of the head of Santa can add colour to the holiday season, it can also be used at other times of the year. This can suit the practical needs of US and European clients."

The Chinese mainland market is also on Zhou's agenda. "Today, young people on the Mainland are becoming more and more interested in Western festivals such as Christmas. More attention should be paid by Christmas gifts producers in Yiwu to this market segment," she said. She could even replace the Christmas elements in Christmas gifts with Chinese festival ones for use at the Spring Festival.

from Cathy Ji, Hangzhou Office

(Image courtesy of Xinhua News Agency)