(Yicai) March 2 -- Business was booming at the Yiwu Small Commodity Market, the world's largest wholesale market for small goods, on its first day of trading after the Chinese New Year holiday on Feb. 28, thanks to merchants’ strong ability to develop new, innovative products and increasingly sophisticated supply chain management.

Customer traffic surged 23.8 percent that day from the same period last year to 291,000 visitors.

Just over 97 percent of the 80,000 booths at the Yiwu Small Commodity Market, which consists of four main markets, namely Yiwu International Trade City, Yiwu Global Digital Trade Center, Yiwu Huangyuan Garments Market and Yiwu International Production Means Market, were open for trading on Feb. 28, a jump of 2.3 percentage points from the same period last year, according to official figures.

The ability to innovate is the key factor that allows Yiwu merchants to remain competitive in the face of intense competition and geopolitical challenges.

Zhejiang Yuejia Textile Technology, which has a textile showroom occupying six shopfronts in the Yiwu Global Digital Trade Center, has strong innovation strengths which allows the firm to stay ahead in the industry, said company director Zhong Chulong.

Because domestic competition has been so fierce, Yuejia's profit margins narrowed last year. Even though overall revenue expanded nearly 10 percent, profits were basically flat. "If you do not differentiate your products, competition gets even more brutal," Zhong said.

One of Zhong’s main priorities this year is building up the company’s brand, especially online where marketing costs are lower. He also plans to sell Yuejia's innovative fabrics directly to industry peers. “Rather than letting other people copy us, it is better to control supply ourselves,” he said.

On top of focusing on product differentiation and brand building, Zhong is also targeting overseas markets this year. "With the strengths we've developed in the domestic market and our fully integrated industry chain, doing business abroad should be easier than at home," he said, adding that exports are expected to become one of the company’s biggest growth drivers this year.

Gala Boost

Yiwu was one of the sub-venues for China Central Television’s Spring Festival Gala television show this year, and products featured on the show have been flying off the shelves since the holiday.

Customer traffic at fashion accessories brand Yin Di on Feb. 28 was several times higher than in previous years thanks to the buzz created by the show, Brand Manager Zhu Sufang told Yicai.

"The day before the Lunar New Year, the broadcaster's cultural and creative team recognized our strong design capabilities, and two of our products were chosen for the show, which has greatly boosted demand for these items," Zhu said. “Pre-sales of products labeled ‘as seen on the Spring Festival Gala’ products have already topped CNY700,000 (USD101,860).”

Zhu's team excels in product innovation. Their main customers are in South Korea. The team’s many years in the fashion accessories sector have given them a sharp sense of trends and strong design skills. Last year, her store’s revenue expanded between 20 percent and 30 percent, hitting a record high. This year, she is aiming for a 50 percent jump in revenue.

Yiwu’s total imports and exports surged 25.1 percent last year from the year before to CNY836.5 billion (USD121.5 billion), topping CNY800 billion (USD116.4 billion) for the first time. Exports soared 24.1 percent to CNY730.7 billion, while imports jumped 32.3 percent to CNY105.8 billion.‌

Editors: Tang Shihua, Kim Taylor