Shenzhen's Huaqiangbei Sellers Are Struggling As Phones Get Cheaper

This is the ground floor of one of the electronics malls in Shenzhen’s famed Huaqiangbei district. Huaqiangbei is a stretch of large malls and shops in the Southern Chinese province, and due to its proximity to some of the manufacturing superfactories in the city, it has a cluster of malls that specializes in carrying tech goods. These electronics malls generally start out with booths on the ground floor and individual store units as you go up the floors. They’re typically buzzing with activity from consumers to wholesalers keen to check out the quality of new devices coming out of the factories. But when I visited some of the malls last month, only a handful of the open booths downstairs were tenanted, and the shutters were down on almost every floor of one of the seven-storey malls. when I asked one of the shopowners what was going on, he said his former neighbors packed up progressively over the past months, forced out by the tight competition of hawking nearly identical products as one another. Ling Liling, who runs a local phone reseller business called Weibintongxin, was at one of the booths downstairs. Her shop window carried an array of Chinese phones as well as Nokia and Samsung knock-offs. She said local phones were starting to sell a lot better these days, compared with several years ago when people were averse to buying local brands. Furthermore, as Nokia’s brand name slips, there is no draw for the average Chinese consumer to pick up a Nokia, knock-off or otherwise, when a dual-core Huawei goes for just as much and works better, she said. Samsung Galaxy S3 knock-offs are still selling well, however. She pointed out that as technology gets cheaper, with most makers running Android, resellers have to either rely on selling shiny knock-offs or hope for volume sales on white label phones. Meanwhile, across the corridor from her, some homegrown brands like Yoobao and Meizu were enjoying comparatively better reception. Rather than imitate foreign brands, these companies have been building up their brand reputations over the past few years. According to analyst IDC, the top five smartphone makers in China?in Q3 last year were Samsung, followed by Chinese makers, Lenovo, Coolpad, ZTE, and Huawei, in descending order. Apple was knocked to sixth place. The display area for some of the local brands was noticeably more dressed up than the section carrying knock-offs

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