Everyone in China's "Little Dubai" knows about Pinduoduo's "100-billion-yuan" plan.

After leaving Yiwu Airport and driving south on the Dongyong Expressway for over an hour, you will arrive at another place that affects the world's pulse - Yongkang.

The factories standing along the way and the roaring assembly lines already demonstrate the unique position of this small city in the global supply chain - the "Hardware Capital of China".

80% of the world's fascia guns, one - third of the vacuum flasks and glass cups, nearly 70% of the security doors... as well as all imaginable hardware products such as electrical kitchenware, scooters, and technical equipment all come from here. Therefore, Yongkang also has titles like the "Cookware Capital of China", the "Door Capital of China", and the "Mug Capital of China".

If the shutdown of Yiwu, the "World Capital of Small Commodities", for one day might make it difficult for the world to celebrate Christmas; then if the factories in Yongkang, over 100 kilometers away, have a slight disruption, many people might not be able to drink water or cook meals.

There is even a saying that if Yongkang suddenly stops producing any hardware products for one day, it will quickly cause a global shortage of over 100 kinds of commodities and a sharp fluctuation in the prices of nearly a thousand hardware products.

Thanks to its prosperous manufacturing industry and the popularity of hardware products both at home and abroad, this fifth - tier small city has become one of the wealthiest counties in Zhejiang. Its consumption level is comparable to that of Beijing, Shanghai, and Guangzhou, and it is known as the "Little Dubai". Yongkang not only has its own local "Haidilao" - style chain restaurants but is also one of the counties with the most luxury cars in China.

As a typical hardware industry in Yongkang, the kitchenware industry provides crucial production support for leading enterprises such as Supor and Joyoung. Moreover, it has also given rise to local brands like Chuangdahuang and Carote.

However, the mature industry also faces many challenges. The market competition is becoming increasingly fierce, and product homogenization is severe. The products produced by many kitchenware merchants in Yongkang are similar in function and design. The profit margin of products is compressed, and their life cycle is also shortened. Merchants need to continuously invest resources in product innovation to maintain their competitiveness in the market.

The external environment is also harsh. The adjustment of international tariffs has brought more uncertainties to the Yongkang kitchenware industry, which relies on exports. The export cost has increased significantly, and some foreign customers have reduced or even cancelled orders, seriously affecting factories and merchants mainly engaged in foreign trade. This has forced many enterprises to re - plan their market strategies.

Pinduoduo's "100 - billion Support" plan has become an important force for them to break through the difficulties. Through measures such as combining big data on consumption trends and platform subsidies, Pinduoduo helps Yongkang kitchenware merchants better understand market demand, optimize product structure, and find new growth points in the domestic market.

Now, with the help of Pinduoduo, the "Cookware Capital of China" is launching a new round of "Kitchen Revolution".

01

The Transfer of Opportunities between the Old and the New

The hardware imprint of Yongkang can be traced back to ancient times.

Yu Li of the Chen Dynasty in the Southern Dynasties recorded in "Ding Lu" that the Yellow Emperor once lived and practiced alchemy on Shicheng Mountain south of present - day Yongkang and cast the Yellow Emperor's Cauldron here.

This story laid the legendary origin of smelting in Yongkang. Since then, swords were cast in the Spring and Autumn Period, crossbow mechanisms were made in the Han Dynasty, copper cannons were produced in the Tang Dynasty, copper mines were mined in the Song Dynasty, and gun barrels were manufactured in the Qing Dynasty. Yongkang's hardware industry has changed with history.

The saying "Hardware craftsmen travel everywhere, and every prefecture and county has people from Yongkang" that has been passed down since the Song Dynasty truly reflects the arduous yet glorious development path of Yongkang's hardware industry over thousands of years.

After 1978, the former "itinerant peddlers" launched a "returning home wave". They returned to Yongkang, set up camps, and opened furnaces to start factories, thus initiating the upsurge of private hardware enterprises in Yongkang. The emerging kitchenware enterprises mostly engaged in foreign trade OEM or domestic brand - sticking business.

In the following two or three decades, benefiting from the industrial dividend, factory owners only needed to focus on production without worrying about sales. As a result, there was not much evolution in the industrial and product forms.

Later, the emergence of e - commerce clearly divided the generations among hardware factory owners. Different from the first - generation factory owners who were engaged in 2B business, their next generation was not content with just being "shovel sellers" and began to enter the C - end market to "seek gold" and capture incremental opportunities in the new field.

Zhou Zhiyu, a merchant on Pinduoduo, is a case in point. In 2012, he built a factory in his hometown, Yongkang. At first, he was engaged in other hardware businesses. In 2015, he switched to various types of kitchenware. In the early days, he mainly did OEM for enterprises in regions such as Europe, America, Southeast Asia, Japan, and South Korea. Now, he also does OEM for domestic brands like Joyoung. However, Zhou Zhiyu has a bigger dream - to create his own brand.

Before joining Pinduoduo in 2020, Zhou Zhiyu had explored e - commerce for some time, but he really saw progress after starting on Pinduoduo. At that time, a non - stick frying pan with a unit price of 100 yuan and daily sales of over a thousand orders made him see the potential of the platform. Later, he set up a dedicated team to delve deeper into it. Currently, he has opened more than 10 stores on Pinduoduo, all of which are black - label brands. Pinduoduo sales account for 50% of all online channels.

For merchants like Zhou Zhiyu who come from a factory background, they lacked e - commerce operation experience in the early stage, so it was difficult for them to break into the traditional e - commerce platforms. However, Pinduoduo's almost zero - threshold policy opened a door for them. Zhou Zhiyu told 36Kr that operating on other platforms requires more refined operations. About six people are needed to operate and maintain one store, while one operator on Pinduoduo can manage three stores. "The operation efficiency is very high."

Sheng Lu, a post - 95s merchant, started on Pinduoduo later than Zhou Zhiyu. In 2019, after graduating from university, she joined a local kitchenware manufacturing company in Yongkang as an operator of the company's Pinduoduo store. This work experience gave her an in - depth understanding of the local kitchenware supply chain in Yongkang and gradually made her see the untapped gaps in the industry and the potential of Pinduoduo.

In 2024, Sheng Lu quit her operation job. While building a factory for the supply chain, she founded the brand "Lanjieshi" with her friends to sell kitchenware such as pots and pans and chose Pinduoduo as the main platform. In the middle of that year, the company sold its first hit product on Pinduoduo, an electronic scale, with daily sales reaching more than 3,000 orders at that time. Currently, the cumulative sales have reached hundreds of thousands of pieces.

The reason for launching such a product stems from Sheng Lu and her team's observation. They found that young people are more particular about cooking. They need to weigh how much salt and starch to put. However, since the accuracy of electronic scales on the market is not high, after more than half a year of research and development, they finally launched a new - style electronic scale with great advantages in price and quality.

According to Sheng Lu, the price of electronic scales is generally not high, around a dozen yuan. However, Lanjieshi managed to make it one or two yuan cheaper. The reason is that through the innovative design of the product's internal structure, its assembly can be semi - automated. "Others may need several processes to complete the assembly, while we only need one."

The direct result is a great improvement in efficiency. For example, when producing 20,000 units per day, other manufacturers need a venue of 5,000 to 8,000 square meters, while Lanjieshi only needs 3,000 square meters. The per - capita daily output can reach 500 units, while the industry average is 300 units.

In addition to the electronic scale, the company has successively launched hit products such as iron pots. The logic behind launching iron pots is similar to that of the electronic scale. They noticed that the public's pursuit of health is increasing. In Sheng Lu's view, most of the current iron pots add coatings to achieve non - stick effects, and no matter how little the coating is, there will be some health risks. Her factory uses nitriding technology to reduce the probability of sticking, which is very suitable for Chinese - style cooking and can be used with steel spatulas and steel wool.

Moreover, based on the feedback from Pinduoduo users, they did not choose traditional cast - iron pots but used lightweight iron pots to solve the problem that traditional iron pots are too heavy for women.

Although the company has only been established for one year, its annual sales have exceeded 100 million yuan, and the number of production lines has increased from one at the beginning of last year to ten.

In recent years, when it comes to the e - commerce industry, the most discussed topic is the "red ocean", and it seems difficult to have a zero - to - one explosion. However, merchants like Sheng Lu and Zhou Zhiyu emerging on Pinduoduo have shattered this view. Opportunities have not disappeared; they have just transferred from traditional platforms to emerging ones.

02

From White - Label to Brand

When a one - year - old brand explodes, its growth story is not always written with glorious moments. Behind Lanjieshi's first hit electronic scale, there is an episode of production suspension.

In the early stage, since the factory was established first, the level of product refinement and familiarity was not very high. Although the market sales of the quickly launched electronic scale exceeded expectations, there were hidden crises behind the high sales - the after - sales rate was extremely high. The high freight costs and refunds caused by returns and exchanges not only wiped out the early profits but also led to a sharp drop in the product rating, and the painstakingly managed link became invalid instantly.

Realizing the seriousness of the problem, Sheng Lu decisively suspended sales. With the feedback and suggestions from Pinduoduo, it took 1 - 2 months to comprehensively review and optimize the product. Starting from raw material screening to production process improvement, they investigated the root causes of the problems one by one, aiming to reverse the situation when the product was launched again. "At that time, the product might not look of high quality in appearance, such as being a bit crooked or having scratches. Later, we found that there were problems with the parts made by the OEM factory, so we re - opened the mold and optimized the design."

After the quality improvement, the sales further increased. By December last year, Lanjieshi successfully obtained the black label and became one of the few merchants on Pinduoduo to get the black - label certification in a short time. The orders soared again.

The so - called black label is the black brand logo displayed at the front end of the product page. It is a certification mark for high - quality brands of merchants with a certain scale and business strength on Pinduoduo.

Just as people associate "10 - billion subsidy" with genuine products, black - label stores on Pinduoduo can be equated with quality to some extent. For black - label brands, the platform has strict screening criteria. For example, the turnover in the past six months needs to reach 6 million yuan, the brand should have a unique style, be differentiated, and not be an OEM brand, and the brand quality level should be high - quality.

Therefore, stores with black labels have higher recognition and trust in users' minds, and the platform will also provide traffic support. They have obvious advantages in both conversion rate and quickly making new products popular. According to Sheng Lu, after the company obtained the black label, the sales increased exponentially, and the success rate of new product hits was extremely high, reaching 90%.

Zhou Zhiyu, who has always been keen on building brands, later launched his own brand "Yizhifu" and also obtained the Pinduoduo black label. "Compared with non - black - label white - label brands, the platform activity traffic for black - label brands is extremely amazing, especially for events like the '10,000 - person group'. Now, we will sell products with hit potential on Pinduoduo." He said that the early difficulties of building a self - owned brand lie in how to open up channels and increase market share, and it is relatively easier to get orders on Pinduoduo.

Since last year, Zhou Zhiyu has mainly focused on new product development. In his view, this is an important way to deal with product homogenization in the industrial belt. "The life cycle of homogenized products is very short. They can only gain market share by squeezing profits. For example, if I sell a product for 50 yuan, there will be competitors selling it for 40 yuan, or even 30 yuan. We don't want to ruin the brand, and innovation is the best way."

The massive data on Pinduoduo enables merchants to accurately grasp consumers' personalized needs, so as to carry out targeted product innovation and optimization and achieve the leap from white - label to brand. "The pre - sales and after - sales customer service handles different customer feedback information every day. We regularly optimize existing products and create new products based on these feedbacks."

For example, the kitchenware used by the older generation is very simple. One wok can almost handle the cooking of various dishes. However, young people make distinctions according to different cooking scenarios and ingredients. Therefore, Yizhifu will launch products to meet various needs for scenarios such as breakfast and single - person meals, such as single - hand - pressed ice cube molds, spray - pour integrated kettles, ebony - stainless steel double - sided cutting boards, and food - grade silicone spatulas and spoons, all of which have become hit products on Pinduoduo.

Another example is that to prevent oil splashing when cooking, they will design a higher - rimmed pot. For problems such as the handle of a traditional frying pan being easy to burn people, they have made innovations such as heat - resistant silicone.

Zhou Zhiyu told 36Kr that building a brand is a long - term commitment. First, it is necessary to be original. Second, it is necessary to continuously accumulate brand favorability and trust, extend the product life cycle, and make consumers recognize the brand. "This is also a better way to deal with homogenized competition such as plagiarism and imitation."

It is reported that Zhou Zhiyu's product department independently controls the whole process from opening a special mold to officially launching the product on the market, increasing the threshold for plagiarism. For some products with high mold - opening difficulty, they will also apply for utility model patents and design patents to enhance the competitive barrier.

03

Adding Another 100 - Billion Support

In the early days, Pinduoduo brought together numerous industrial belts in China, providing them with business opportunities. Through this, the platform also achieved a breakthrough and rise. After large - scale expansion, facing the vicious circle of homogenized competition, breaking the deadlock is not only a problem for merchants to think about but also a challenge for the platform to solve.

Therefore, Pinduoduo has always been committed to helping industrial - belt merchants cross the narrow bridge of OEM, start from white - label products, and then upgrade to high - quality new brands to dig out more profit margins.

In the past year, Pinduoduo has successively launched measures such as the "10 - billion Reduction", the "E - commerce Goes West" campaign, and the "New - Quality Merchant Support Plan", leading the e - commerce industry into an era of "meticulous operation". It is not eager for "utilitarian" indicators such as traffic competition, GMV growth, and revenue growth rate but focuses more on high - quality development aspects that benefit merchants, such as