SHANGHAI: The Internet is evolving into a new platform for job hunters, including both middle-aged laid-off people and 20-somethings, to start a new business in this largest metropolis of East China.
Yang, a 48-year-old former railway worker, had tried to start some small businesses before she became an online shopkeeper, which she had never expected.
Over the past three years, Yang struggled in a line of petty trades, which monthly cost her about 5,000 yuan (US$602.40) each for store rental and charges on water and power supplies, while earning her meagre profits.
Yang began to run a virtual store online last year. Starting with a mere investment of 100 yuan (US$12.05), the online business has scored a monthly sales income of several thousand yuan. Yang is planning to expand the business from daily necessities to toys and jewellry.
Besides Yang, more than 1,000 people have started online businesses as full-time careers in Shanghai, since a campaign last July was kicked off jointly by the local labour and social security authorities and the municipal e-commerce trade union to improve employment through Internet services.
The online business operators trade cosmetics, clothing, headwear and footwear, digital cameras, mobile phones, computers, audio-visual products and books.
Under the campaign, which is part of Shanghai's re-employment programme, another 3,000 citizens have benefitted from related training for launching online businesses.
The trade union said that in 2003, e-commerce in Shanghai nearly doubled the value of a year earlier to reach 50.4 billion yuan (US$6.07 billion), with virtual stores and online franchised businesses becoming trendy.
Eachnet, a well-established e-commerce website in Shanghai, alone registered more than 1,500 start-ups each with a full-time online store operator, and jobs offered by the virtual stores have numbered over 5,000, according to the trade union.
Including those with part-time operators, the number of online shops that started last year through Eachnet exceeded 50,000, according to the e-commerce trade union.
According to Tang Lei, a PR manager with Eachnet, a successful online store operator is able to realize a monthly transaction volume of 20,000 to 30,000 yuan (US$2,409-US$3,614) and a profitability of 50 per cent on average.
Meanwhile, another Shanghai-based e-commerce service provider specializing in electronics has opened 30-plus online franchised stores over the past year, with another 100 applicants for starting up such franchised businesses.
Zhao, a 50-year-old retiree from a local textile factory, raked in as much as 150,000 yuan (US$18,072) in monthly business turnover from the franchised electronics operation.
Dubbed grassroots e-commerce, online business start-ups have not only won favour among middle-aged unemployed citizens, but also among college graduates.
Xu, who was a Chinese language and literature major at prestigious Fudan University in Shanghai, has opened an online store to trade cosmetics and scored a monthly business volume of more than 10,000 yuan (US$1,204).
Low start-up costs were one of the deciding factors behind the upward trend of grassroots e-commerce, said Yi Yong, head of the local e-commerce trade union.
In rough calculation, to start an online store costs about one-10th what it does to start a conventional small business, such as a purified water shop or a laundromat.
The 100 e-commerce enterprises incorporated in Shanghai are now encouraged to set aside part of their jobs for people trained by the municipal e-commerce trade union, and those offering such jobs will enjoy favourable treatment from the municipal re-employment programme, said Zhou Weidong, head of the Shanghai commission for building an IT-based society.
Shanghai plans to provide 500,000 jobs for laid-off workers every year. The online business start-up campaign will help offer 10,000 jobs by the end of this year.
To achieve the goal, it is necessary to remove some regulatory barriers for the campaign, according to Zhou Weidong.
He cited the absence of e-commerce regulations, which is hindering the massive expansion of e-commerce.
"Without such rules, it is difficult to certify the legitimacy of an online transaction," Zhou said.
"The cost of management is another obstacle to preventing e-commerce from swelling," said an e-commerce company official, complaining about the low quality of work done by some business operators.
Currently, most of the operators are laid-off or the retired, and many are not well-educated.
Zhou revealed that the municipal taxation administration was studying how to certify online receipts and provide tax holidays associated with e-commerce.
It is also necessary for the local government to work out a package of incentives for e-commerce enterprises to lower their costs for participation in online business start-ups, Yi said.
"An online business start-up park will come into being in the near future in Shanghai to help citizens acquire business licences for e-commerce trade," Yi added.
Xinhua
(Business Weekly 06/01/2004 page17)
