While companies like Fruitday.com are more well-known in the space, young retailer Xianguomai is making its own mark in China's booming e-commerce produce sector. With a focus on "small and high quality", the company whose name means "Fresh Fruit Purchase" in Mandarin is seeking ways to exploit its uniqueness in a very competitive market. To hear more on the subject, www.freshfruitportal.com spoke with its CEO Wu Wei.

Wu highlighted the Xianguomai team is made up of members who had given up their old jobs and were new to the fruit industry.

"There were designers, Internet technicians, and so forth. All of us gathered together mainly because the food safety issue a few years back that had troubled many Chinese people. So we aimed at the middle and high-end market," Wu said.

Speaking about the differences between Xianguomai and other specialized fresh produce e-commerce suppliers, Wu said his business was characterized by two concepts - youth and customer experience.

"Most of our customers at this point are young people aged between 25 to 35 years old. And there are some corporate customers, such as Bank of China and Citibank," he said.

In the eyes of Wu, as a non-traditional fruit distributor, Xianguomai's strengths lie more in marketing than trading channels.

"From the very beginning, we focused on stabilizing the customer base and solidifying our reputation. Although we are doing online business, we would launch all sorts of tasting activities, or we would deliver the sliced fruit to the customer in person, so that we could communicate with our customers face to face, in order to better our service."

Apart from this, he said Xianguomai would analyze the price per customer and rates of repeat purchases, to gain a better understanding of customer needs.

He added logistics was another key element in Chinese e-commerce.

"We put most of our investment to two aspects: one is advertisements and another one is refrigerator and logistics. Now, we are using full-course cold chain logistics, which is a result of the cooperation with SF Express. If the financing is successful, we plan to build our own refrigeration facility in northern China."

Wu also expressed his respect for other specialized fresh produce e-commerce suppliers, including Fruitday.com.

"Fruitday had an early start, so they have accumulated a great deal. But the fresh produce market in China is huge. At present, I think there will be a vast market in second- and third-tier cities. But the precondition is a developed cold-chain delivery.

As for the upstream of the supply chain,Wu believed his company was a beneficiary of agricultural industrialization.

"Now we normally sign contracts directly with the orchards at the original producing areas, which shortens the supply chain, as well as guaranteeing the freshness of products. And this is beneficial for the customers.

"But the supply chain of imported fruit is still prolonged. And with too much professional knowledge required, we can only outsource the business. We do hope that we can import directly some day in the future.

"As for growers, I am pleased to see the trend of agricultural industrialization. The cooperative community is a good example. Rural areas in China are still undermanned. It takes time to realize the agricultural industrialization but I can feel that farmers' way of thinking is changing, getting closer and closer to that of the first-tier cities.

Yet when talking about the hot term "Internet Thinking", Wu said the technology was just a tool, whose role has been largely exaggerated by people.

He said making investments did not necessarily rely on the internet, and composure was needed in the face of the increased attention given to agricultural financing.

"Capital would speed up the completion of the entire industry. Last year, we received a sum of investment from angel fund. In the future, if we intend to build our own refrigeration facility, financing will be what we need.

"But we don't want to see a rapid expansion, nor do we want to be seen as a company that has money to burn. We will make every decision with the utmost discretion."

www.freshfruitportal.com