The Future Outlook and Trends of the E-Cigarette Industry

The future outlook and trends of the e-cigarette industry is the theme I want to share today. I am the head of Shenzhen Yuhe International Logistics Co., Ltd., and I have always defined myself as a person in the e-cigarette and freight forwarding industry.

I have been engaged in international logistics for 14 years, and I have been an entrepreneur for 11 years, also serving the e-cigarette industry for 11 years. Throughout my entrepreneurial journey, I want to thank my partner Tang Binbin, my investor Meihua Venture Capital, and I also want to thank my most supportive clients and benefactor, Chairman Liu of Yijiate.

The reason why these new and old clients choose to cooperate with us, aside from our professional and high-quality service, is that we also hold a special e-cigarette drug transshipment license issued by the Hong Kong Department of Health and a dangerous goods license issued by the Hong Kong Shipping Authority. Of course, we also possess one of the few international and domestic express operating licenses in China, as well as the authorized agency qualifications for TNT and FEDEX in China. We firmly believe that compliant operations are the key to sustainability.

Next, I would like to share my theme today from the following three stages:

Jungle Stage

Ten years ago, the e-cigarette industry was composed of small workshops with 3-5 people, lacking scale, technology, funding, and intellectual property. It primarily relied on imitation and plagiarism to start, and at that time, customs didn’t even have product customs codes, and logistics was a blank slate.

After so many years, many large factories and industry leaders have emerged in the industry. Of course, many companies have also faded away. As someone who has been in the e-cigarette industry for 11 years, I have witnessed the industry's ups and downs.

Integration Stage

After 11 years of development, the entire industry has made leaps in quantity, quality, and market scale. With the continuous improvement of consumer levels, customers have raised higher demands for product quality diversity and personalization, leading to increasingly fierce market competition. Only through scaling, intensification, and modularization can we effectively reduce industry costs.

From the current state of the industry, previous non-standard practices, such as cash transactions and related transactions, are still common, leading the entire industry to rely solely on self-funding for operations, making it difficult to obtain support from financial institutions and capital. Without support from financial institutions and capital, the integration and development of the industry are limited.

Bottleneck of the Second Stage: Now we see that traditional bulk trade is changing, and new brands entering the market are increasingly demanding small batches, frequent orders, and personalization.

Industrial Stage

The e-cigarette industry is about to enter the third stage - the industrial stage. There will be solution companies, chip platforms, factories, traders, brand owners, logistics, and supply chains.

This is the e-cigarette industry supply chain that I have envisioned since 2014. These terms may be unfamiliar to everyone in the industry. The involvement of these new forces fully proves that e-cigarettes are entering a new industrial stage.

In the imagined industrial stage of the e-cigarette industry, brand owners were previously traders or factories, but with the development of the internet, they are now sellers, players, influencers, or investors.

They will need to provide fragmented, personalized, and small-batch orders to solution platforms, which will then push the implementation orders to the e-cigarette supply chain platform. The supply chain platform will complete the procurement of raw materials, send the raw materials to factories for flexible production, and the finished products will be stored, delivered, and have tax refund services completed by the supply chain platform. There will also be financial services such as order financing, tax refund financing, and warehouse receipt financing.

Xiaofeixi has launched integrated logistics services for e-cigarette brand owners. Brand owners only need to request standard products produced by factories to be sent to our designated integrated warehouse, and we can complete the processes of warehousing, shelving, sorting, labeling, storage, and distribution, effectively improving the efficiency of brand owners and reducing costs.

In terms of technology, Xiaofeixi provides clients with a self-developed order ERP system, WMS warehousing system, and TMS domestic logistics system, offering comprehensive B2B and B2C drop shipping services.

I believe that through the joint efforts of everyone present, the e-cigarette industry in our country will surely transition from "Made in China" to "Intelligent Manufacturing in China." The E-Cigarette Industry Alliance welcomes friends who want to make a career in the e-cigarette industry to communicate together. You can consult WeChat: vapeos or call our e-cigarette market manager: 17682343645.