CICC: The optimism in cross-border e-commerce is rising, and leading sellers may witness a turnaround in their operations.

CICC has released a research report stating that from 2026 onwards, as the trade environment stabilizes, inventory pressure is alleviated, and weaker companies exit, leading cross-border sellers may experience a bottoming reversal, with leading sellers becoming even stronger. Benefiting from supply chain efficiency and innovation in e-commerce models, Chinese companies are leading global competition, but there remains substantial room for growth in seller scale. Agile supply chains, digital transformation, and AI adaptation create a competitive moat for sellers. The bank is optimistic about the operational reversal and market share gains of leading cross-border sellers under advantages of regulatory compliance, brand leadership, and AI transformation. CICC's main viewpoints are as follows: In 2026, cross-border e-commerce prosperity is on the rise, and leading cross-border sellers may see an operational turnaround. From 2020 to 2023, the penetration rate of overseas e-commerce increased under the context of the pandemic, combined with multiple catalysts such as consumer subsidies in Europe and the United States and domestic platforms going overseas, leading to an influx of cross-border sellers and intensifying industry competition. Beginning in 2024, U.S.-China trade frictions will constrain overseas business expansion, coupled with tightening e-commerce platform rules, reduced traffic support, stricter cross-border tax declarations, and logistics regulation, industry operational pressures will continue to rise, particularly impacting small and medium-sized sellers. From 2026 onwards, as the trade environment stabilizes, inventory pressure is alleviated, and weaker companies exit, the bank believes that leading cross-border sellers may experience a bottoming reversal, with leading sellers becoming even stronger. The global industry is rapidly expanding, with Chinese sellers taking the lead, but there is still room for improvement in individual seller scale. Cross-border e-commerce efficiently connects high-quality production in China with the overseas demand for quality and price. Under robust supply and demand, the industry is expanding rapidly, with brand-oriented, supply chain-focused, and platform-based sellers blooming in multiple areas. According to the General Administration of Customs, from 2020 to 2025, Chinas cross-border e-commerce export volume is expected to grow at a CAGR of 15.9%. Benefiting from supply chain efficiency and innovation in e-commerce models, Chinese enterprises are leading global competition; however, due to the distant target markets, long business chains, and difficulties in capability transfer, the number of Chinese cross-border sellers is large, but their scale remains small. According to MarketplacePulse, by 2025, about 50% of active sellers on Amazon will be from China; however, in July 2026, among the top 100/5,000 to 10,000 brands by sales volume, the GMV share of Chinese sellers will be 6.8%/45.1%, indicating significant room for improvement in seller scale. Product branding serves as a foundation, and agile supply chains, digital transformation, and AI adaptation build a moat for sellers. 1) Product quality is the underlying capability of cross-border sellers. Brand-oriented sellers focus on product differentiation to achieve quality growth through proprietary brands, while supply chain-oriented sellers emphasize quick responses across multiple categories to support business development with stable supply; 2) Agile supply chains determine operational efficiency, with flexible supply chains for small orders driving core competition. Brand-oriented sellers enhance turnover through process production and bulk procurement of raw materials, while supply chain sellers accelerate response through flexible purchasing; 3) Digital transformation and AI adaptation enable centralized management. The long business chain of cross-border e-commerce necessitates that sellers use AI tools and digital control for centralized resource management and refined operations to enhance labor efficiency. Risks Geopolitical and trade friction risks; changes in platform rules; intensifying industry competition; overseas demand not meeting expectations; exchange rate fluctuations; rising risks in raw material prices.