Only 20% Stores Operate Digital Products and Some Even Sell Tofu in China’s Computer Mall

Once upon a time, Guangbutun Computer Mall was famous across China. There was even a saying in the industry that in the north, there is Zhongguancun Village in Beijing and in the south, there is Guangbutun in Wuhan (the capital of Hubei Province). In the past, as school year began in September, in September and October, the nine malls in Guangbutun Computer Mall area was always crowded with people. However, before the China’s National Day this year, the reporter’s field visit found that there was a depression in the market. Related department conservatively estimates that the number of digital merchants in the Guangbutun has reduced by at least a third. At the computer mall like Antarctica Computer Mall, there is only a bit over 20 percent stores running digital products.

Computer Mall has lean season when school year begins

In the past, the back-to-school season was the peak season for the computer market, with crowds of college students coming to buy computers. However, on September 23, the reporter saw another scene in Guangbutun Computer Mall.

“Hello, do you want to buy cell phone? What kind of model do you need? Come in and have a look!” When reporter walked in the first floor of Wuhan Computer World Mall, many sales personnel from different brands came up to ask. The computer market has almost become the mobile phone market.

Then the reporter came to the second floor, only to find few customers there. The negative layer had a similar scene.

Guangbutun Computer Mall ever played an important role in Wuhan computer market. The nine computer malls, namely, Cyber, Zixun, Huangzhong, Luojia, Antarctic, Wuhan, Lanpu, Big World and Bainaohui, were quite famous. Guangbutun Computer Mall was not only the priority for local to buy mobile and computers, but also where non-local retailers and wholesalers came to buy products.

Mr. Li sells brand computers, and as early as 2008, he established store in Guangbutun Computer Mall. He is one of the earliest store owners. Talking about his current business situation, he sighed, “many merchants already lose money in operation. I plan to stick with it for a while and I will quit if it doesn’t work well.” In his memory, in 2012, he could sell more than a dozen computers within a day. While now, when the business is good, he could sell 2 to 3 a day. And sometimes, he couldn’t sell a single computer the whole day. He couldn’t make any profit on such sales. He added his store had good position and some businessmen may not be able to sell one computer for a few days

Sell Tofu in computer store

Ms. Zheng, a managing staff for Antarctic Computer Mall from Industry and Commerce Bureau of Guangbutun, said, “Most stores in Antarctic Computer Mall have changed to restaurants and department stores. Computer store became place selling soybean curd and mobile phone store became place selling braised chicken. Now, only a quarter of the merchants operate digital products.” There were about 200 stores selling mobile phone and computers. While now, stores on the first and third all changed to catering businesses. And quite a few stores are department stores.

There were 350 stores selling mobile phones and computers in Cyber Plaza, while now, it introduces “non-digital” businesses. About 150 stores are department store. In addition, there are more than 40 catering businesses stores. Business people in charge of Bainaohui Computer Mall also told the reporter that Bainaohui Computer Mall was also actively “transforming”. At present, there are more than 40 catering operators there.

Director Huang from Industry and Commerce Bureau of Guangbutun said, at the peak there was over 5000 stores selling digital products in Guangbutun Computer City, mainly selling mobile phones and computers. Their clients were not only the university students in Wuhan but also targets at five provinces of central China and even more than half provinces in China. The number of merchants selling mobile phones and computers has decreased a lot. The most conservative estimates is the number has reduced by a third.

Traditional computer cities are hit by e-commerce

When it comes to the decline in computer sales today, merchants are most likely to say that they are hit by e-commerce. “Once upon a time, customers came to the computer mall to buy a computer, but nowadays most customers come here to compare prices,” said Tan.

“We have rent and labor costs,” said Ms. Wang of another store. Compete with e-commerce by price, and physical stores are not competitive at all

In addition to the impact caused by e-commerce, Tan thinks it also has something to do with the shrinking market. He said, “laptops and desktops are now not popular electronic products. mobile phones and tablet are the mainstream.” He said he ran computers as well as peripheral products such as cameras and video games. Sometimes, these products’ profits even exceed that of computers.

Mobile phone stores “upgraded” into experience shops

Reporter found that many mobile phone stores in computer mall have “upgraded” into experience shops. Shop owners introduce in detail the performance of the mobile phone. According to the special needs of customers, they recommend different phones and lively demonstrates special functions such as effect of cameras and language operation. At the scene, the price of mobile phone is similar to that on the Internet. The most important thing is that once the “three guarantee” problem occurs, consumers can directly complain to the owner. If the mobile is bought online, it will be more difficult for consumers to complain to the non-local industrial and commercial department.

In addition to service upgrades, products are quietly “upgrading”. According to introduction made by managing staff for Lanpu Computer Mall from Hongshan District Giamgnitun Trade Industry, currently, the number of merchants selling phones in Lanpu Computer Mall is very few. Most have started selling software, games, etc., traditional computer mall is turning “smart city”. Manager Xu from Zixun Computer Mall also told reporters that in addition to mobile and computers, many smart products were sold there, including robot for early education, smart trash can, sweep robot and intelligent UAV.

This article originally appeared in Wuhan Evening News and was translated by Pandaily.