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Successful Way of China Plastics City

With no plastic materials and large-size petrol-chemical enterprises, the original “plastic material street” has grown into such a remarkable China Plastics City with a trade volume of 8 million tons of products worth 10 billion yuan.


Reporter with this Newspaper Yang Xuzhong Yu Xiaochen


■ Honesty


Over 2,300 enterprises have homed in this 3.25-㎡ area with over 20,000 brands, nearly covering all Chinese brands.


Last year, the trade value scored a record 98.274 billion yuan, up 15.2 % over the previous year.


Twenty years ago, it was only a street selling plastic raw materials. On September 8, 1994, China Plastics City was established.


How could China Plastics City in Yuyao make such a great success? The first answer is: honesty.


Liu Wenda, president of Ningbo Kaichuang Trade Co., Ltd. and winner of “Lifetime Achievement Award” of China Plastics City, witnessed its development history. “In the 1990s, the first group ‘veterans’ started to do plastic trade in Yuyao, but I am the only fighter in the plastic trade battlefield now.” As a soldier in his youth, Liu Wenda liked to describe the business competition in military items. The 67-year-old Liu Wenda told us “honesty” was the key of his success.


In the early time, such phenomena as no invoice and adulteration were common. “But Ningbo merchants are smart and honest, they don’t deny their faults even though they lose money. This is our basic business principle.” Liu Wenda told reporters several stories of his loss to maintain his honesty.


By virtue of his honesty, Liu’s two companies have become the sole agent of such European and American giants as Bayer in China. The advanced materials have been used in auto parts, medicine, aviation and aerospace and other industry. The annual trade value of his two companies have topped 200 million yuan.


Owing to numerous merchants like Liu Wenda, China Plastics City can build its brand and go global.


■ Innovation


Innovation is through the whole process of the development of China Plastics City.


In 2004, based on its spot market, China Plastics City established Zhejiang Plastics City Online Trade Market, Chinese first plastic e-commerce trade center.


At present, the Online Market has become a multi-functional and multi-level e-commerce service platform integrating electronic transaction, settlement and information release. It has more than 10,000 registered members across China. From January to August, the trade volume and trade value reached 3.2637 million tons and 35.826 billion yuan, up 8.2% and 11.5% respectively over the previous year. Since its establishment, its trade volume has taken up 50% of the total in six consecutive years. It has become China’s biggest plastic e-commerce center, equal to another China Plastics City.


The “China Plastic Warehouse Receipt” independently developed by the Online Market has become the first plastic e-commerce mode, half a year earlier than the Plastics Futures launched by London Metal Exchange


Under the “China Plastic Warehouse Receipt” transaction mode, enterprises can realize the electronic spot trade and provide convenient logistics service for traders. It has 108 brands from five types such as LLDPE, PP, ABS, HDPE and PVC. The electronic trade has enhanced the efficiency, avoided operation risks and reduced cost.


“This innovation has changed the traditional spot trading mode and marked an important step to integrate Chinese plastics and international market,” said Professor Zou Xiaopeng of School of Economics of Zhejiang University.


The first commodity index—China Plastic Price Index was also issued in November, 2006.


This Index is composed of China Plastic Warehouse Receipt Price Index and China Plastic Spot Goods Price Index. It is an index system reflecting the true price of plastics and the the expectations of future price of plastics. From July, 2007, Xinhua News Agency has begun to releases real-time updates of China Plastic Price Index. Presently, the index is released by over 60 plastic industry websites. Besides, Dalian Commodity Exchange began to release the index from this March. The Index has been listed in Price Index Monitoring System and named “IT-based Industry Situation Index Enterprise” and “IT-based Industry Situation Enterprise Model” by the Ministry of Industry and Information Technology of the PRC. In November, 2013, the Index was listed as “Top 10 Chinese Influential Commodity Market Index”, which greatly enhanced the influence of China Plastics City.


■ Policy


Over past years, China Plastics City has won numerous honors and titles, such as the first batch of key national markets listed by the Ministry of Commerce, the top 50 China commodity markets, top 50 valuable commodity markets, China production material innovation-type market, China top 100 commodity market, key national market model.


The “four-in-one” core competitiveness of China Plastics City—


Market brand. China Plastics City has a high reputation in Chinese special market. It has won a dozen of firsts in trade volume, trade categories and e-commerce, etc.


Industry cluster. As a key industry cluster, China Plastics City has formed a well-functioned plastic industry chain. “Yoyipay”, the third party payment platform developed by Zhejiang Yoyi Electronic Payment Co., Ltd., was put into service this March. It is the only Zhejiang-based third party payment platform with commodity trade and payment experience and the leading platform in commodity payment in China. In 2006, the “Plastic Research Institute in China Plastics City” co-founded with No. 53 Research Institute of China Weapons Group was honored as the innovation service platform of plastic processing technology.


Functional innovation. Innovating and improving the modern function of market are key to upgrade the traditional special market and stimulate the market vitality. Over 20 years, China Plastics City has consecutively launched modern functions, such as information release (China Plastics Online), price guidance (China Plastic Price Index), exhibition (Plastic Expo), R&D and innovation (Plastic Research Institute), invisible market (Online China Plastic Spot Trade) and fund settlement (Electronic Transaction Third Party Payment), etc., which maintain its leading place in plastic trade market.


Policy support. China Plastics City is listed among the first batch of key national markets by the Ministry of Commerce, the key program in “three-in-one” port and shipping logistics service system construction by Zhejiang provincial government, and 15 commodity trade center in “12th Five Year Plan” of Ningbo. Besides, Yuyao municipal government has always attached much importance to it and has formulated the Determination on Accelerating Upgrading and Leap-frog Development of China Plastics City, which provides chances and impetus for its upgrading..


Embrace the trend of the times, cultivate the core competitiveness and lead the new development of plastic industry—China Plastic City is striding forward to the international plastic market.