China's largest electronics commercial area Huaqiangbei propels entrepreneurship

At 9:00 a.m., electronic markets at Huaqiangbei commercial area in Shenzhen, south China's Guangdong province, were already bustling with activities. Known as the largest commercial area for electronics markets in China, Huaqiangbei was crowded with people running errands, making purchases and enquiring about prices.

Lu Dongli, in his forties, walked through the crowds and made his way into the Black Ark, a hardware innovation center in the Electronic Technology Building of Huaqiangbei.

Lu came to Huaqiangbei in 2006 for semiconductor trade. Five years later, he founded his company ChipReal in a small cubicle within the SEG Science and Technology Park of Huaqiangbei. Such a tiny cubicle measuring one meter in width was also referred to as a "one-meter counter."

Photo shows the SEG Electronics Market in Huaqiangbei commercial area, Shenzhen, south China's Guangdong province. (Photo from the official account of the Information Office of Shenzhen Municipal People's Government on WeChat)

There are countless one-meter counters in Huaqiangbei, each representing a business venture and the aspiration of entrepreneurship.

"Thanks to the complete industrial chain and aggregation effect in Huaqiangbei, our company has experienced steady growth in recent years," said Lu.

In October 2022, Lu moved his office to an office building in the central area of Huaqiangbei, turning his one-meter counter into a business start-up that covers over 300 square meters.

There are millions of entrepreneurs like Lu in Huaqiangbei. Before China began the reform and opening up process in 1978, Huaqiangbei was only a large paddy field. After Shenzhen was established as a special economic zone, major enterprises started building factories in the region, laying the foundation for the electronics industry in Huaqiangbei, which later emerged as one of the most vibrant business hubs in Shenzhen.

Just one month ago, Lu's company received an intended order for 40,000 power supply chips annually. Yesterday morning, the company got an unexpected call from the customer to confirm the order, and Lu immediately contacted his suppliers, only to be told that market prices had risen and their previously agreed price was no longer valid.

A man inquires about prices of electronic products in front of a "one-meter counter" in Huaqiangbei commercial area, Shenzhen, south China's Guangdong province. (Photo from the official account of the Publicity Department of Futian district, Shenzhen, on WeChat)

Lu made a quick decision to replace the supplier. "I don't want to make a poor deal and couldn't risk losing a potential client as well," said Lu.

"There's nothing you can't buy in Huaqiangbei," Lu said.

As a business area covering 1.45 square kilometers, Huaqiangbei is home to around 110,000 businesses, each of which has business relations with factories across China. This has made Huaqiangbei the world's largest distribution center of electronic parts and components.

After spending nearly two hours making phone calls, Lu eventually found a supplier whose office was right in the building next to his.

Lu received the samples at 2:00 p.m., checked the necessary details, and then sent them to a third-party organization for examination. Subsequently, he received the approval certificate, which marked the success of his new deal.

Technical services are also essential for a seller of electronic parts and components. Since 2018, ChipReal has expanded its business into product distribution, providing clients with technical assistance throughout the entire production process, from solution design to mass production.

Photo shows a view of Shenzhen, south China's Guangdong province. (People's Daily Online/Chen Zhiqiang)

Behind this expansion was a change in its business strategy. "Trading a single product can lead to quick profits, but it also comes with high risks. By expanding our range of services, our business has become more stable and sustainable," said Lu.

Thanks to the expanded technical services, ChipReal has seen an average annual revenue growth of 15 percent and gained nearly 900 new clients in China's Yangtze River Delta, the Pearl River Delta and northeast China.

In the first half of this year, the company's sales volume rose by over 10 percent year on year, with technical services contributing nearly 40 percent to the increase.

Huaqiangbei, which gave birth to numerous "one-meter counters," is undergoing a profound transformation. Last year, 100,000 square meters of business areas were newly built in the commercial area, and over 80 percent of the space of newly renovated electronics markets has been rented. This year, 14 business incubators began serving more than 400 innovative companies, and daily foot traffic in the business areas has exceeded 1 million.

Seizing new opportunities, Huaqiangbei is brimming with new vitality. Planning to build itself into a global electronic component trading hub, a global hardware innovation and entrepreneurship center, and an international consumer center for trendy electronics, it is growing into an internationalized district for innovation and entrepreneurship.