HILVERSUM, Netherlands—After the melamine milk powder tragedy in China a few years ago, Chinese consumers’ trust in Chinese infant formula brands is miles away (literally)—all the way to the Western Hemisphere.
Chinese who can afford it can buy foreign brands of milk powder through the Internet, and this provides Chinese living abroad with a business opportunity: exporting baby formula to China.
Since 2012, Chinese women have gone to supermarkets and drugstores in the Netherlands to fill their shopping carts with well-known Dutch milk powder brands.
Dutch baby food manufacturer Friso is none too happy about this surge of new customers. Friso fears that the Chinese market’s insatiable thirst will outpace its ability to produce the milk powder, leaving nothing for Dutch babies.
“We mostly see Chinese people buying big quantities of our products, taking it with them in their luggage [on a plane] or sending it back to China,” said Jasper Aansorgh, sales manager at Hero, which owns the Friso brand.
In a press release three weeks ago, Friso went as far as to call them “looters” and called upon Dutch supermarkets and drugstores to sell no more than two to four packages of their brand of milk powder per customer.
Most drugstores and supermarkets have attached a note to their infant formula shelves, stating that: “For all Nutricia and Friso infant formulas: a maximum of 4 cartons per person. Unfortunately, we are compelled to take these measures due to a shortage in the Dutch market. The reason thereof is the rapid export growth of infant formula to China.”
But if Chinese buyers don’t mind the looks of disapproval from Dutch customers and shop employees, they can still collect a fair amount of milk powder each day. An average Dutch city center will have at least six places selling infant formula within walking distance.
After they collect what they can, the day’s yield is typically cramped and stacked into the house, garage, or storage, from where tins and cartons will soon make their way into the vast mainland of China by airmail, mostly sold through Taobao Marketplace, a Chinese language website for online shopping, akin to eBay.
On Taobao, these products are sold for at least double the Dutch retail price. Some Taobao shops sell more than 6,000 Friso tins or cartons a month, but the average Taobao store sells a lot less, as they, too, have to first win the trust of customers. Most start with selling to friends and family in China, and build their reputation from there.
A few months ago, when there were no restrictions on buying Dutch infant milk powder, Chinese would post pictures and video recordings online of themselves buying infant formula inside a Dutch store, to prove its authenticity to Chinese buyers.
Many Chinese in the infant formula business have immigrated to the Netherlands over the last 10 years. They often do not speak Dutch well and are forced to take on manual work, like cleaning or working in restaurants, to earn more money. Their Chinese diplomas are often not recognized in the Netherlands. For most, exporting Dutch infant milk powder just brings in pocket money, netting 100 to 900 euros a month. For others it provides a full income of around 1,500 euros a month.
Many do not give much thought to the drama—six babies having died and countless poisoned—that lies at the heart of this business opportunity. Others consider it both a business and a charity, as they provide Chinese parents with an alternative to potentially contaminated Chinese infant powder.
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