D2C x Chinese Whispers

Hey readers,

Welcome to the seventh edition of D2C Cents!

This edition? We talk about:

• How to China-proof your D2C business before it's too late

• The sharpest D2C news that matters

Ali Express and TikTok are back in India!

At least that’s what’s buzzing on social media.

The google search for Aliexpress, Alibaba, Shein, Temu shows a big spike.

Are they actually back? Well, maybe not yet.

The Indian government has clarified: "Government of India has not issued any unblocking order for TikTok. Any such statement or news is false and misleading."

But this rumour has revealed one thing for sure:

Most D2C founders are worried about Chinese platforms returning

Why the worry? It’s simple math.

Let's dive right into it.

The partial website accessibility wasn't a policy change. Possibly, a technical glitch.

But it exposed a fundamental vulnerability of India's D2C ecosystem.

Price arbitrage masquerading as brand value.

• Indian brand’s premium luggage bag: ₹9,999

• Same bag on Alibaba/AliExpress: ₹1,523

The mismatch is evident.

Now let's address the elephant in the room.

A lot of successful Indian D2C brands have some China dependency.

Be it electronics/gadget brands sourcing their components, fashion brands outsourcing their manufacturing or beauty brands importing raw materials, China is omnipresent.

Why the dependency exists:

Keeping politics aside, every entrepreneur would want the best for their brand(and ideally should), but this case is a bit different.

The Strategic Problem: When AliExpress or similar platforms return, they eliminate the information asymmetry that many D2C brands depend on.

In simple words: Customers can directly compare your ₹10,000 bag with the ₹1,500 factory price. And even purchase it directly from China.

The vulnerable categories:

The Chinese guillotine also depends on how geopolitics is shaped in the next few weeks. Let’s explore how the recent tariffs by the US might play an important role…

Impact of US Tariffs on Indo-China Relations

Recent improvements in India-China relations, hastened, in part, by Trump's tariffs, have created a complex geopolitical backdrop for D2C brands and their sourcing decisions.

The Three-Way Dance:

What this means for D2C founders:

• Short-term: Potential Chinese platform return creates pricing pressure

• Medium-term: Geopolitical shifts may affect sourcing costs

• Long-term: Supply chain diversification becomes a strategic necessity

4 Moves to China-proof your D2C Business

Move 1: The Transparency Strategy

Why transparency works:

• Builds consumer trust through honesty

• Preempts negative discovery before competitors expose you

• Allows premium positioning based on design/quality, not false patriotism

Move 2: The Value Migration Framework

Stop competing on price arbitrage. Start competing on:

The boAt Example: Despite facing competition from Chinese alternatives, boAt maintains market leadership through brand positioning and consumer connect, even as Fire-Boltt and Noise gain ground.

Move 3: The Supply Chain Diversification

Don't put all eggs in the China basket:

Cost Impact: 10-15% higher costs, but crisis insurance is worth it.

Move 4: The Platform Defense Strategy

When (not if) Chinese platforms return:

• Product differentiation: Ensure your products can't be easily found on wholesale platforms

• Brand storytelling: Create narrative value that generic products can't replicate

• Customer relationship: Build direct relationships that survive price competition

• Service moats: After-sales support, warranties, local service that Chinese platforms can't match

Case Study: Lessons from the Mokobara Mayhem

Earlier this year, Mokobara, the "designed in India" luggage brand, became the poster child for this crisis when social media detectives found identical products on Alibaba at 1/6th the price.

The brand's response? A new product line offering a 10% discount with a cheeky discount code "WHITELABEL”

The internet wasn't amused. It created a huge wave of negative publicity for the brand.

What this means for every D2C founder:

• One viral Twitter thread can expose your entire supply chain in hours

• Consumer trust, once broken, takes years to rebuild

• "Designed in India, Made in China" isn't automatically a problem - hiding it is

Mokobara's crisis is a preview of what's coming for brands that built pricing power on information asymmetry rather than genuine value.

Among this, the winners will be the ones that build such compelling value propositions that customers choose them even when cheaper alternatives are one click away.

Your supply chain isn't your secret shame - it's your strategic choice. Own it, improve it, and build an honest brand around it.

The future belongs to brands that can create value beyond manufacturing arbitrage.

Location transparency will become normalised, and brand differentiation will depend on innovation, experience, and genuine value creation.

And that’s actually what brand building should look like!

See you next edition - same time, sharper insights.

Until then, keep building (transparently).
Abhishek