Tmall Global Updates Multiple Merchant Standards

From January 2021, Tmall Global, the cross-border e-commerce platform of Alibaba, continuously updated several Standards for merchants, including:

• Tmall Global Merchant Acceptance Standards of 2021

• Tmall Global Merchant Qualification Standards of 2021

• Detailed Rules for Qualification of Tmall Global Merchants in Operation

• Tmall Global Fee Standards

From the updated Standards, we can get the following information.

The threshold for brands' entry becomes lower

Beauty brands are among the biggest beneficiaries of the update. In the beauty sector, the "Tmall Global Merchant Qualification Standards of 2021" deleted the requirement that trademark registration must be one-year long, reduced the authorization requirements for  trademark owners of specialty stores, and no longer limited the range of  Tmall global stores' entity companies (Before the update, beauty brands' Tmall global stores’ entity companies must be registered overseas, in Hong Kong, or Macao). The personal care sector has lowered the threshold accordingly.

These new policies mean that many newly established beauty and personal care brands will have the opportunity to enter the Chinese market before they have successfully registered their trademarks. They can also rely on local agents to open stores. The entire process of entering China will undoubtedly be smoother.

Deposit is reduced

In addition to lowering the threshold for brand qualifications, merchants’ deposit has also been adjusted. The "2021 Tmall Fee Standard" states that brands that operate stores on Tmall Global must pay a deposit to ensure that their businesses operate by Tmall Global's rules. The amount of deposit varies across store type.

Tmall Global divides the stores into six categories: brand flagship store, marketplace flagship store, industrial marketplace flagship store, exclusive store, specialty store and galaxy franchise Store. Except for special categories, the basic standards for these types of stores range from 50,000 to 300,000 yuan, mainly in the grades of 50,000, 100,000, 150,000, and 300,000 yuan.

There are three main categories as special categories: mother and infant, health care, and services. It is worth mentioning that according to the old standard, beauty is also classified as a special category, and a deposit of 150,000 or 500,000 yuan is charged for different types of stores. However, the "Tmall Global Fee Standard" implemented on May 22, 2020 has moved the beauty category out of the special category, and this year's new standard also continued this practice. In other words, the deposit that merchants in the beauty sector are charged has been significantly reduced. Also, Tmall Global will charge an annual fee of 30,000 yuan in technical service fees for cosmetics (including beauty tools).

In conclusion, this update is undoubtedly beneficial to many overseas merchants, especially merchants in the beauty sector. ChemLinked also gets the latest information that Douyin will launch its cross-border e-commerce (CBEC) business soon, probably in March 2021. Tmall Global, as the biggest CBEC platform in China now, will encounter the challenge from a platform with great traffic, which may be one of the reasons it applies these updates.

ChemLinked also provides services to help brands enter Tmall Global. If you have any further question, please feel free to contact us by contact@chemlinked.com.