The answer is Yiwu!
Why Yiwu Is Cheap?
A huge manufacturing base around Yiwu makes the prices here very competitive.
Yiwu is located in Zhejiang province, which is one of the two manufacturing bases in China. It’s also close to Jiangsu province, Jiangxi province, Anhui and Fujian province, these neighbors are becoming stronger and stronger for manufacturing.
Yiwu itself is very strong for a few labor intensive industries like fashion jewelry, hair accessories, handbags… Scale effect brakes down the prices in Yiwu.
Strong competition makes the prices here even lower. Because of the huge market. Many prices are transparent. If one showroom quotes a higher price, customer will go to the neighbors.
The business model in Yiwu is “bulky quantity and cheap price” A lot businessmen here just crazy about quantity. They can even sacrifice some profit and increase quantity, as a result, they become stronger and stronger, then they can get cheaper and cheaper prices from factories. Then they further break their price down…