The biggest dividend brought by rural e-commerce is the return of talent to their hometowns

Attracting talent to return home is the biggest dividend brought by rural e-commerce.

If he had not heard about rural e-commerce startup projects when he returned home for this year's Spring Festival, Luo Sha, a 26-year-old young man of the Dong ethnic group from Guizhou, would probably still be working 1,300 km away from home in Wenzhou, Zhejiang, doing front office management at a hotel - just like the vast majority of China's hundreds of millions of migrant workers, who surge into the Spring Festival travel rush every New Year, returning from the coast to their hometowns like migratory birds for a brief reunion with their families.

"A stable job in the city is good, but it still can't compare with starting a business at your own doorstep. The e-commerce major I studied in university has come in handy, I can stay with my parents, and I feel like I have a business of my own," Luo Sha said.

Luo Sha is the "operator" of the "Rural Taobao" service station in Huangdao Township, Wanshan District, Tongren City, Guizhou Province. Relying on his understanding of the internet and e-commerce, after the Spring Festival he defeated the other 4 candidates applying for this station in Alibaba's "Rural Partner" selection and set out on the path of entrepreneurship.

Luo Sha's job is to help villagers buy goods as abundant as those available to city dwellers through the internet, earn income through the backend purchasing-agent rebate model, and at the same time help villagers sell local specialties from the mountains online. E-commerce companies provide computers, LCD televisions, regular training and backend technical support, while the local government offers subsidies and support policies for infrastructure, for example making express delivery reach villagers' doorsteps for the first time. Previously they could only pick up parcels in the town, or even had to go to the county.

After 21 years of internet access, China has become the world's largest online retail market. While industries and consumption in first- and second-tier cities are being transformed in the internet wave, China's vast rural areas have still not been fully awakened because logistics and network infrastructure are relatively weak. At present, the growth rate of online shopping in first- and second-tier cities has begun to slow, while small towns and rural areas are ushering in an explosive period.

McKinsey said in a report released in February this year that although China's rural internet penetration rate is currently only 19%, about 60% of rural digital consumers are using e-commerce, and they are just as active as urban residents. AliResearch predicts that in 2016 the total consumer market of China's rural e-commerce will exceed 460 billion yuan, and with the spread of logistics and network infrastructure, rural online shopping may even surpass urban online shopping in the next 10 to 20 years.

Internet companies are turning one after another to the rural market, this new blue ocean, in search of growth space. JD.com recently announced its rural e-commerce development strategy, building "JD Help Service Stores" and county-level service centers in rural areas. Suning.com also announced in April that it would make the rural market a major strategy this year and would set up its own service stations in fourth- and fifth-tier markets. Alibaba Group launched the "Thousand Counties and Ten Thousand Villages" plan last year, announcing that it would invest 10 billion yuan and establish 1,000 county-level operation centers and 100,000 village-level service stations within three to five years, covering one third of China's counties and one sixth of its rural areas.

The business logic behind this is to use e-commerce platforms as the foundation, build county- and village-level service networks, break through bottlenecks in logistics and information flow, and realize two-way circulation in which online goods go to the countryside and agricultural products enter the cities.

Besides rushing to paint promotional slogans on rural walls and the backs of houses, e-commerce companies began looking locally for e-commerce entrepreneurs. But they soon discovered that large numbers of rural young people had long gone out to work, while women, children and the elderly commonly stayed behind, and people skilled in using the internet were not easy to find.

Another reality is that, with economic and social development, local governments in the central and western regions are also trying to attract young people to return home to start businesses, but the industrial base of the past and young people's willingness to take jobs are often not consistent.

"In the past, attracting young people to return home lacked a suitable vehicle. Now, with the introduction of the internet and e-commerce, young people are more willing to come back. It is not just about opening online stores; the entire industrial chain extended by e-commerce, including logistics, packaging and marketing planning, can bring a large number of entrepreneurial opportunities," said Wu Zhaohui, executive deputy director of the E-commerce Office of Tongren City, Guizhou Province.

Guizhou Province is promoting the "Wild Goose Return Project" for the return of talent, and Tongren City has in practice reached cooperation with e-commerce companies to mobilize university graduates and young people with skills and ideas to return home and start businesses. From the end of 2014 to now, 50 village-level rural Taobao service stations have opened and begun operating in Tongren, and this year it plans to open 500 stations.

"Some entrepreneurs were mobilized through lectures at the 'E-commerce Grand Lecture Hall,' and the government also has a dedicated department that liaises with young people working away from home. More and more people are signing up, and usually 4 to 5 people compete for one position," Wu Zhaohui said.

In Zhejiang, where the atmosphere for e-commerce entrepreneurship is strong, returning university students are injecting vitality for transformation and upgrading into small-scale rural e-commerce "Taobao villages." China currently has 212 large-scale "Taobao villages," 62 of them in Zhejiang. Bainiu Village in Lin'an, known for processing and selling roasted nuts, is one representative, but after years of development, the constraints of homogeneous price wars and a lack of e-commerce talent have become increasingly obvious.

Zhang Qing, secretary-general of the E-commerce Association of Bainiu Village, originally worked in finance at a listed company after graduating from university, but now she has also returned to her hometown to start a Taobao store, bringing in professional technical talent that is hard to attract to rural areas, connecting with e-commerce platforms, and helping the village's online stores move toward branding and distinctive development.

More and more government departments have seen the catalytic effect of the internet on young people returning home to start businesses. The Department of Human Resources and Social Security of Zhejiang Province and Alibaba reached cooperation not long ago, planning to train 50,000 e-commerce personnel over the next 5 years, promote 40,000 people to start rural e-commerce businesses, and directly drive 150,000 people into employment.

The State Council's "Opinions on Further Doing a Good Job in Employment and Entrepreneurship Under the New Situation," issued at the end of April, pointed out that support should be given to farmers starting online businesses, vigorous efforts should be made to develop "Internet Plus" and e-commerce, innovative and entrepreneurial farmers should be actively organized to connect with enterprises, moderately prosperous villages, markets and parks, and the action to promote rural youth entrepreneurship and enrich the people should be advanced.

However, weak infrastructure, and even blank areas in some regions, along with a lack of industrial chains, are difficulties right before our eyes. In rural areas of the central and western regions, some villages still have no network coverage. In some areas population density is low, express delivery volume is small, logistics costs are high, and delivery stations are difficult to sustain. From buying to selling, entrepreneurs must help every rural household sell agricultural products, but most companies involved in links such as packaging and preservation of agricultural products have not entered the countryside. As for food safety, individual and family agricultural products urgently need support for quality inspection, and some regions are trying to bring in third-party quality inspection agencies.

"Young people returning home to start businesses help farmers buy and sell, and what they bring is more a change in awareness. As farmers move from not knowing about the value of the internet to watching, understanding and participating, they will think in new ways about agricultural products and agriculture, and this will change the face of rural areas," Wu Zhaohui said.