Startups see Taobao as launchpad to success

"Some of our customers cannot see the value behind the designs," said Nie. "Taobao is famous for low prices, and some of our customers ask us, 'Why are your goods so expensive?' But the price is already very low when you consider the design costs."

"There are also lots of stores copying my designs, and without the design costs they can offer lower prices which makes it very difficult to compete with them," Nie added.

But despite the problems Taobao has nurtured many successes over the years and more and more young people want to try and emulate that success.

Formed in 2003, Taobao's market share was 94.5 percent at the end of June, according to the China e-Business Research Center.

However, with more and more offline retailers launching e-commerce businesses on Taobao, it is not so easy for startups to succeed. To meet the demand, Taobao launched a business-to-customer platform called Tmall at the beginning of this year, in a bid to attract more offline retailers. Many box-making factories which used to be Wang's suppliers now have their own stores on Taobao.

Chen Shousong said if startups want to compete in the new environment, they will need to invest more than they did before and they will need to be more professional.

"They need to find quality products and get low prices from suppliers. They need to market themselves through online advertising and they must provide a good customer service."

But with 15 million transactions on Taobao every day, there are plenty of young people willing to give it a try.

suzhou@chinadaily.com.cn