With the looming Trump’s tariff on China, there is a lot of uncertain for North American businesses that sources from China. It is a major concern as new wave of Chinese overseas ventures was rising since 2023. In recent years, the "going global trend" revolved around beauty, apparel, and toys. Chinese enterprises accelerated their pace of expansion abroad, aiming higher with a mission to "sell higher-end products at premium prices to more developed markets.
Based on export sales and growth rates, there are three major "going global" trends: home appliances, home security and portable energy storage, and mobility. The top ten categories of "Made-in-China" products that are booming abroad are home appliances (refrigerators, washing machines, etc.), robot vacuum cleaners, kitchen appliances, personal care appliances, smart cameras, smart locks, portable energy storage products, electric two-wheelers, e-bikes, and new energy vehicles.
The collective overseas push by China's four "cross-border e-commerce dragons"—Temu, TikTok Shop, AliExpress, and SHEIN—joining forces to challenge Amazon and making it easier than ever for Chinese goods to go global. Chinese are removing middle person, drop shippers and Amazon completely and handle logistics and last-mile delivery themselves. Under this economic pressure, what can North American ecommerce businesses do?
Chinese Home Appliances Dominated North American Markets
When discussing Chinese goods that sold exceptionally well overseas in the past year, home appliances are unavoidable.
From a macro perspective, data shows that based on the low export base of late 2022, China's home appliance exports accelerated significantly in 2023. While home appliance exports are not a new trend, two noteworthy shifts emerged in the past year.
Firstly, Chinese appliance companies entered the phase of branded global expansion, targeting European and North American markets and disrupting existing competitive landscapes. For example, Haier and Midea's forays into home appliance goods have challenged traditional leaders like Electrolux. Particularly, heat pump contractors from Ontario, Canada, have been installing only Chinese brands with a 10 year warranty and they are widely accepted. Secondly, cross-border e-commerce has made small appliances a lucrative export category. Kitchen appliances and personal care devices are particularly popular, with leading brands including Supor, Bear Electric, and Deerma.
Chinese companies are leading the development of cleaning appliance technologies and adopting AI in products like robot vacuums, wet-dry vacuums, and smart refrigerators, enabling them to capture more overseas market share. COVID pandemic accelerated the digitalization of global appliance sales channels, shifting from primarily offline to online. Recognizing the opportunity, leading Chinese appliance companies have invested in optimizing sales channels and building brands, either through acquiring established local brands or by heavily promoting their own. Smaller appliance brands or manufacturers without the resources for high logistics and marketing costs have leveraged cross-border e-commerce platforms to expand overseas.
Home Security Products Thriving in North America
Similar to home appliances, the home security and portable energy storage sectors are thriving overseas. North America in particular has been driving this as population density is low and crime rate has been increasing exponentially. In the first half of 2024, robberies were up 21%, breaking and entering was up 6%. This market went from niche to a mainstream category as detach, but products like smart cameras, smart locks, and portable power stations have gained widespread popularity.
Key players in home security include EZVIZ (a Hikvision subsidiary), Imou (a Dahua subsidiary), and Tapo (a TP-Link subsidiary). These companies focus on markets outside the U.S., targeting regions like Europe, Southeast Asia, and the Middle East, where penetration rates are low but potential is significant. Two of the biggest concerns for North America end users is privacy and security, which the recordings are stored in Chinese servers and can be accessed. For anyone who has lived in China would know that there are no secrets in China as all data is shared. During COVID lockdown, I shared my personal information to hotels and officials. A few days later, a person who claims to be a police officer visited me. To this day, I still don’t know if he was real or not. I believe there is a market gap here where North American companies sell Chinese security hardware while providing domestic software solutions and in-person service.
Low-cost Electric Vehicles for Everyone
From generating mountains of bikes trash from the shared bike economy, China reshaped the global mobility industry by making significant strides in electric two-wheelers, e-bikes, and new energy vehicles (NEVs). With the boomer generation retiring and in need of a simple mobile solution in cities, e-bikes and cheap alternative NEVs become very attraction options as inflation refuses to decrease.
- Electric Two-Wheelers: Southeast Asia's shift from gasoline to electric-powered vehicles has created enormous demand, with 200 million gasoline motorcycles poised for replacement. Chinese brands like Yadea and Niu Technologies are leading this transformation.
- E-Bikes: Gaining popularity in the U.S., Europe, and Japan, e-bikes are favored for fitness, short commutes, and recreation. With an average price of $1,000-$3,000, these bikes represent a high-margin opportunity for Chinese manufacturers.
- NEVs: China's new energy vehicle exports surged, with Europe becoming the top market. Brands like BYD and MG have expanded aggressively into Europe, taking advantage of local emission policies and a rapidly growing NEV market.
China dominates the global EV battery industry, commanding a 56% market share and holding 70–90% of the market across all stages of the value chain. While this leadership reflects China's significant role in the lithium-ion battery sector, safety concerns have emerged, particularly regarding e-bikes. Incidents of e-bikes catching fire during charging have raised questions about product quality and safety standards.
North America's e-bike market is on a steady growth trajectory. According to Triton Market Research, the market is projected to grow at compound annual growth rates (CAGRs) of 10.34% (revenue) and 10.89% (volume) between 2022 and 2028. North American cities demonstrate varying levels of market saturation, with Toronto has 43 e-bike stores, Montreal has 34 stores, and Los Angeles a remarkable 297 stores.
However, the market for home battery installations remains underdeveloped. Both Toronto and Los Angeles have fewer than 10 home battery installation services. In regions with strong hydroelectric infrastructure, such as Quebec and Manitoba, lower electricity rates and municipal incentives make electric adoption more attractive. This potential suggests room for growth in residential battery solutions, particularly in areas where renewable energy can support affordable, sustainable options.
Canadian eCommerce Adapting to Chinese Exports
How can North American companies compete against foreign competitors benefiting from government incentives? The answer lies in identifying unique strengths and market gaps.
For resellers, opportunities abound as China focuses heavily on exporting products. Platforms like Temu, TikTok Shop, AliExpress, and SHEIN flood the market with low-cost goods, offering a boon for consumers but having limited impact on domestic suppliers. North America has largely moved away from producing cheap goods, so these platforms complement rather than threaten local supply chains. However, Chinese exporters face challenges in competing on quality and product size, as their low base costs must offset high bulk logistics expenses.
For domestic suppliers, the largest competitors are often immigrants or individuals with foreign connections, leveraging access to manufacturing facilities abroad. These investors rarely prioritize North American operations, as expansion in regions with lower costs remains more profitable. Logistics, accounting for 50% of these businesses' costs, is a major limitation. Consequently, products that are large and heavy—such as home and site furnishings—are often unprofitable for these companies. This leads resellers to focus on either luxury goods or low-quality items, creating a notable gap in the mid-market.
Market Gap in Canadian Furniture eCommerce
The home furniture market in Canada is a great example of an untapped opportunity. Young Canadian buyers with a preference for modern styles face limited options. On the budget end, they can choose between IKEA or mid-tier retailers like The Brick and Structube, which often suffer from unreliable service and deceptive pricing practices. Higher-end options like Mobilia and EQ3 cater to a premium market but lack robust eCommerce systems.
This leaves a significant market gap for modern, well-designed furniture priced between $500 and $1,000, sitting comfortably between IKEA and mid-tier brands. The opportunity lies in creating an eCommerce-focused business offering:
- Affordable yet quality designs appealing to younger buyers.
- Transparent pricing practices to build trust.
- A seamless online shopping experience that outpaces competitors’ outdated systems.
By addressing these gaps, Canadian businesses can carve out a competitive niche, bridging the divide between affordability and quality while leveraging eCommerce to stand out in a crowded marketplace.
