Digging Out of a Sales Rut

Xiaoning Wang of ChinaSprout is working to turnaround her educational-products company.

Colleen DeBaise By Colleen DeBaise

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Few things are more discouraging than a long steady sales decline — particularly after a business has enjoyed success. Xiaoning Wang knows this a bit too well.

In 1999, Wang was inspired to start her company, ChinaSprout, after noticing American parents with adopted Chinese children in New York City parks. She searched online and learned there were thousands of such families around the country. “These families so want to know about China and want their children to learn about their heritage,” she said. She began selling Chinese cultural products, such as books and toys purchased on trips to her hometown of Beijing, and the home-based business took off. After a year, she moved her inventory into a warehouse and hired her first employees.

By the early 2000s, ChinaSprout’s e-commerce website was humming along, as adoptions continued to rise. “Meanwhile, I started working with the schools at that time, too, because we were on the Internet, and the schools start searching books about China,” she said. In 2007, Advanced Placement introduced a Chinese language exam, which helped Wang sell textbooks, soon the biggest category on her site. In 2008, the Beijing Olympics created another surge, as consumers turned to ChinaSprout for pins, bags, bracelets and other memorabilia. And then sales started a steady decline — and Wang, who still works seven days a week, said things have yet to recover.

The reasons for the drop-off were myriad. Starting in 2007, China began instituting stringent rules for foreign adoptions, barring people who are single, obese or older than 50 from adopting Chinese children. Then, the recession hit. Schools curtailed budgets and purchased fewer titles from ChinaSprout. And more recently, Wang has needed to fend off competition from big publishers and distributors, who are eager to tap the Chinese-language market and have the resources to offer schools — now Wang’s biggest customers — discounts and freebies.

Sales are off about 11 percent from 2009 levels, she estimated, although she still stocks more than 7,000 titles and sells about 50,000 books and materials a year to more than 1,000 schools nationwide. She has eight employees, and so far, she has not had to lay anyone off. She declined to disclose her revenue.

Now 52, Wang is taking steps to conserve ChinaSprout’s resources and promote her company’s attention to customer service. In November, she uprooted her operations from Manhattan and moved to Long Island City in Queens, effectively cutting her rent in half. Her new space is about 6,000 square feet, a bit smaller than what she had before. “At least our rent is not a burden,” she said. “I was thinking of the future.”

Wang, who stopped going to conferences for her company a few years back, now plans to step up appearances at trade events for educators and book fairs. She is considering hiring representatives in different states to help sell more books to school districts. She is also looking to improve her e-commerce site, using online advertising and more social-media marketing to drive visits to her site. Neither Facebook nor Twitter have been effective for her, but she said has had more luck using WeChat, the popular instant-messaging app developed in China. “Lots of Chinese teachers are on it,” said Wang, who said she plans to share more images, chat more with teachers and offer more personal recommendations for books.

She makes frequent trips to China to source materials and develop relationships with Chinese suppliers. Back in the United States, she curates her selections on her website, listing educational materials by grade level, language proficiency and topic. She often stays up throughout the night — which is daytime in China — to hammer out the details of orders with Chinese suppliers. “Teachers say, ‘You are the best’ — that is really encouraging,” she said.

It’s less encouraging, she said, when customers fill their shopping carts on her site or request recommendations and sales quotes from her directly — and then go elsewhere to place the order. “This is so not fair,” she said. But the majority of her longtime education clients are loyal, she said. More recently, she has been calling them to ask, “Is there anything better I can do?”

Wang hopes that interest in the Chinese language won’t drop off the way interest in Japanese and Russian did after the 1980’s. “It is so rewarding when I can introduce China, and Chinese culture and language, to a teacher,” she said. “It’s a meaningful business. I just want it to do well.”

Do you have any suggestions for Wang? If so, leave them in the comment section.

Posted: March 11, 2014

Colleen DeBaiseDigging Out of a Sales Rut