How to access 1.5 billion consumers through Hong Kong

At LogiCommerce Connect 2025, Judith Padrós and Ricardo Ferrer —co-founders of the Spain-Hong Kong Business Association— shared a highly practical perspective on how to enter the Chinese and Asian markets through online channels, highlighting Hong Kong's strategic role as a bridge between both worlds.

China and the power of eCommerce

China is a growing economic powerhouse poised to become the world’s largest economy within the next decade. Its digital market is among the most advanced globally, with examples like influencer Li Jiaqi and Jack Ma (co-founder of Alibaba), who sold €145 million in just 1 hour and 30 minutes of live streaming. This figure alone illustrates the strength of eCommerce in the country.

However, the rules of the game are different. China’s digital ecosystem has its own platforms, social networks, and search engines, so Western strategies rarely succeed unless they are fully adapted. As the speakers emphasized, companies must “localize to China” — meaning they need to tailor their marketing strategy, product, logistics, and customer service to the Chinese market.

Domestic vs. Cross-Border eCommerce in China

When it comes to selling online in China, there are two main models: domestic eCommerce (selling from within China) and cross-border eCommerce (selling from outside of China). Choosing the right model depends on your company’s presence in the country, available resources, and the type of product you offer.

1. Type of business entity

• Domestic eCommerce: Requires a registered company in China (WFOE – Wholly Foreign-Owned Enterprise).
• Cross-Border eCommerce: Only requires a company established in Europe or Hong Kong — i.e., outside of China.

2. Entry requirements

• Domestic: Requires physical presence and operations within China.
• Cross-Border: No direct operations in China are necessary.

3. Stock and operations management

• Domestic: Operations take place in China, with stock stored within the country.
• Cross-Border: Stock can be stored in China (e.g., in free trade zones) or abroad.

4. Corporate tax

• Domestic: Subject to China’s corporate tax (25%).
• Cross-Border: Depends on the tax regulations of the company’s country of origin (e.g., Spain or Hong Kong).

5. VAT

• Domestic: 17% for goods, 6% for services.
• Cross-Border: Only 70% of the applicable VAT is charged.

6. Import duties

• Domestic: Based on the applicable tariff code.
• Cross-Border: Duty-free, as long as the product complies with the limits established by China’s Cross-Border eCommerce law.

7. Product registration

• Domestic: Mandatory in most cases, which can involve long and costly procedures (especially for cosmetics or food).
• Cross-Border: Not required if the product is included in the government’s “Positive List,” which outlines authorized products for this type of sale.

This comparison is useful for deciding how to begin selling in China. If you want to test the market without making a large initial investment, the Cross-Border model can be an excellent starting point. And using a base like Hong Kong can simplify the entire process.

Why Hong Kong?

Hong Kong is a strategic launchpad for operations in Asia:

• Setting up a company is fast and cost-effective.
• Taxes are significantly lower than in Europe.
• It is a free port: no VAT or import duties.
• It serves as a logistics hub for all of Asia, not just China.

This enables both online and offline operations, and supports gradual expansion into other Asian markets from a solid base.

Key recommendations for expanding into Asia

• Study the market carefully: Entering China involves high costs, so it’s vital to thoroughly analyze your sector, competitors, and distribution channels.
• Adapt to the local ecosystem: From payment methods like Alipay or WeChat Pay to brand communication — everything must be tailored to the Chinese consumer.
• Partner with local experts: After-sales support and logistics are critical. Trustworthy partners in China can make all the difference.
• Leverage logistics tools: There are options that allow storing products without paying taxes until the sale occurs.
• Use Hong Kong as a “lab”: It’s ideal for testing the market, minimizing risk, and benefiting from flexible legal and fiscal frameworks.

The role of the Spain-Hong Kong Business Association

Officially supported by the Hong Kong Trade Development Council, this business-focused association serves as a bridge between Asia and Spain. It is led by entrepreneurs with hands-on experience in China and provides practical support to companies looking to enter the Asian market.

Services include:

• Networking events in Spain and Hong Kong.
• Access to logistics and flight discounts.
• Support for company formation.
• Business matching among members.
• Direct liaison with Chinese authorities.
• Constant updates on regulations and business opportunities.

The association is also organized into sector-specific groups — such as logistics, startups, eCommerce, education, and consulting — to foster collaboration and synergy among members.

Conclusion

Asia is a key region for any company with international ambitions, and Hong Kong can be the ideal entry point. With tools like cross-border eCommerce, top-tier logistics infrastructure, and support from entities such as the Spain-Hong Kong Business Association, companies can take this step strategically and sustainably.

If you’re interested in exploring this path, LogiCommerce encourages you to get informed, plan strategically, and surround yourself with the right partners to unlock the full potential of a market of over 1.5 billion consumers.

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