“This kind of purchasing agency is currently not supported, but there is still no clear way to prevent them from doing this,” said the public relation department of Costco Shenzhen, referring to shopping agents. After sending questions about the purchasing agency on Costco’s “Contact Us” page, Costco Shenzhen called back and responded.

Undeterred, Fung vows to find a way to make it in the shopping agent business. 

“Most of our current orders are only around HK$300. Sam’s Club is still not sure whether it could deliver goods to the doorstep, but we can. I believe we will still have some space for us in the future,” Fung said.

Fung posts in these Facebook groups to promote himself and to get customers into his own WhatsApp group. There are currently 740 people in Fung’s group and new customers are joining every day. Customers will share their experiences about different products and discuss which ones are worth buying.

The costs of border crossing can be offset by making large purchases, which creates a business opportunity for cross-border shopping agents. Additionally, Hong Kong license plate private cars can’t go to the mainland easily. Private car owners from Hong Kong can only obtain a mainland license plate if they pay over HK$150,000 in taxes in the mainland each year. As a result, successful small business owners with investment experience in the mainland are the most suitable candidates to be cross-border shopping agents.

At the same time, Hong Kong doesn’t levy tariffs or impose quotas on goods purchased in the mainland, which makes cross-border shopping more convenient for agents.

All products Fung brought back from Shenzhen that day

After unloading the goods from his and his colleague’s cars, Fung was finally able to drive home. Up until this point, he had not sat down to eat in almost 10 hours. 

And after a busy day buying cakes, breads, instant noodles, and different kinds of snacks for five orders around Hong Kong, he and his three colleagues will only have around HK$200 gross profit per person.

Just like Fung’s shopping agent service, numerous online shopping agents advertise their businesses. However, they all encounter a common challenge of having limited profit margins. Since the prices of goods in Shenzhen are transparent, if an agent slightly increases the selling price, customers will seek out cheaper alternatives. 

For example, a box of six packs of frozen burgers is priced at 89.9 yuan (about HK$97) on the official website of Sam’s Club. Fung needs to charge HK$134 to make a profit, but other agents list it for HK$119 or even less. Consequently, most agents either attract more orders through superior service and after-sales support or explore other methods to expand their business.

The shopping agent business, though already difficult enough, may become more difficult still. According to the South China Morning Post, after paying an annual fee of 260 yuan (HK$281) to become a member of Sam’s Club Hong Kong customers can enjoy free delivery service as long as they make a single purchase of 599 yuan (HK$647) or more. Costco also admitted that a similar policy for Hong Kong delivery service was under discussion, but without any details yet.

As a newcomer in this highly competitive industry, after two months without being able to cover the cost of hiring people to help him, Fung came to a stop in April. One of his colleagues, Bon Lau, also left him.

“It makes no money at all,” Lau said. 

However, after a 10-day pause, Fung figured out new ways to make profits as a shopping agent.

 Korsf Lee and Phoebe Lam stand before their frozen meat store

The mall had light foot traffic. Lee said customers only came when they needed something. Most stores remained closed during workdays.

In July 2023, Lee used Lam’s frozen meat shop as his base to sell products purchased from Sam’s Club, but soon there was not enough space. 

“When we first started working as shopping agents, the business was very good. There was even no room for me to stand in the frozen meat store since all the shelves were filled, even the floor was almost full of stuff,” Lam said.

Lee soon decided to rent two more stores on the same floor like Lam’s frozen meat store, specifically for their Sam’s Club shopping agent business. Because the store serves as the front, it is closer to the lift than his wife’s frozen meat store. He no longer goes to Sam’s Club every day to buy goods like he did last year, but instead tries to fill his car as much as possible every time he goes to Sam’s Club. When Lee is away, Lam also takes care of the business of Lee’s store. At the same time, Lee encourages his clients to go to the frozen meat store and the shopping agent store by setting lower margins than other competitors. He sells those products only with a 10% gross margin.

Besides selling Sam’s products with low margin, he also breaks down packaged goods and sells them in smaller units

“It is always easier to ask thousands of people to give me a dollar each than to ask one person to give me thousands of dollars,” Lee said. 

Though they did not calculate the specific profit data, both Lee and Lam said the customer flow increased more than 50% compared with days before taking the shopping agency business. In addition, they had customer WhatsApp groups with more than 3,000 members.

In those groups, Lee and Lam update information about the new products they purchased from the mainland and the different imported meats newly arrived at their frozen meat store frequently. When Lee once introduced his newly purchased hair removal devices from the mainland, it made the group members excited. Compared with the prices in Hong Kong stores, Lee’s prices were 50% cheaper. The price advantage prompted happy customers to publicly share their experiences of using hair removal devices in the WhatsApp group.

“It’s so cheap to buy from you. The old model I bought during the sale a few months ago was much more expensive than this one I bought from you,” a customer said in the WhatsApp group.

When Fung paused his business, many clients asked why he stopped and when he would restart. This gave Fung a stronger confidence to restart the shopping agent business in mid-April, but he also realized that he should not only depend on Sam’s Club and Costco; the competition was simply too fierce.

Like what Lee had done, Fung started to diversify his sources of supply. In May, he expanded the types of goods he purchased on behalf of customers to include cheesecakes and flowers. Fung also plans to add a new clothing category. Nowadays, he can complete around 20 orders at a time when he goes shopping in Shenzhen.

Fung said these added categories can not only enrich the variety of products in his business but also increase the profit of each product. For cheesecakes, it does not require too much time to purchase. Fung only needs to pick up the cakes at the door of the cheesecake chain store and take them away. In addition, he also got the contact information of the store manager. The manager could help him set aside the cakes or notify him to pick up the cakes when there are few customers.

At the bakery store in Shenzhen, the cake cost about 49 yuan (HK$54). When Fung took it back to Hong Kong, it was worth HK$95 on his web page. Since the purchase did not take much time, plus this cake was very popular among Fung’s customers, he could earn more profit from it. On days when the order volume was high, he said there would be more than 20 orders including cakes, which meant these cakes could bring Fung and his colleagues an extra gross profit of around HK$800.

By cooperating with flower shops, Fung tried to reduce the cost of buying flowers

Fung updates the styles of what he offers to clients by taking pictures of flowers

He couldn’t wait to launch this idea and planned to go to the wholesale market to reach a deal with the shop owner within two weeks. 

He also wanted to start this business on his website as soon as possible. Though the T-shirts didn’t even have a layout and were not ready for sale, he has added a blank product category specially for the T-shirts on his website.

“I feel that I haven’t fully figured out the logic of my products on my website, so I don’t dare to expand my business further,” Fung said. “But I have been able to earn more money than before, so I believe I am on the right track and I can do better.”