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A new form of parallel trading within economics relations between Russia and China

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  • Sergey Sosnovskikh

Abstract

This paper investigates the phenomenon of ‘daigou’. Daigou are perceived as harmful in China as they do not pay any import taxes. However, daigou have established well-organised supply-chain channels on the borders between Russia and China and have helped to boost sales for Russian regional businesses. With the help of in-depth interviews, this study provides three core findings. Firstly, it describes the entire supply-chain structure of daigou activity in Russia-China trade relations and the methods used by daigou to bypass border customs controls. Secondly, it explores the key benefits for Russian manufacturers and retailers and shows how they cooperate with Chinese daigou. Finally, it proposes that daigou are not just purchasing representatives but that they also act as consultants to Russian manufacturers and retailers and may therefore have a significant impact on the marketing costs, product development, and internationalisation strategies of those manufactures and retailers.

Suggested Citation

  • Sergey Sosnovskikh, 2021. "A new form of parallel trading within economics relations between Russia and China," Post-Communist Economies, Taylor & Francis Journals, vol. 33(1), pages 94-118, January.
    • Handle: RePEc:taf:pocoec:v:33:y:2021:i:1:p:94-118
    DOI: 10.1080/14631377.2020.1745562
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    Cited by:

    1. Glavas, Charmaine & Mortimer, Gary & Ding, Han & Grimmer, Louise & Vorobjovas-Pinta, Oscar & Grimmer, Martin, 2023. "How entrepreneurial behaviors manifest in non-traditional, heterodox contexts: Exploration of the Daigou phenomenon," Journal of Business Venturing Insights, Elsevier, vol. 19(C).
    2. Gleb Aksenov & Ronglin Li & Qamar Abbas & Houlda Fambo & Sergey Popkov & Vadim Ponkratov & Mikhail Kosov & Izabella Elyakova & Marina Vasiljeva, 2023. "Development of Trade and Financial-Economical Relationships between China and Russia: A Study Based on the Trade Gravity Model," Sustainability, MDPI, vol. 15(7), pages 1-39, March.
    3. Natalia N. Yashalova & Dmitry A. Ruban & Natalia A. Latushko, 2021. "Cultivating Patriotism—A Pioneering Note on a Russian Dimension of Corporate Ethics Management," Administrative Sciences, MDPI, vol. 11(3), pages 1-9, July.

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