The Shijing surplus stock market cluster, bringing together markets like Qingfeng, Jindong, and Yinma with over 10,000 shops combined, deals exclusively in clearance, and the industry widely believes that about 40% of China's apparel inventory is ultimately absorbed here. Brand end-of-season stock, factory leftovers, livestream returns, and export overruns hit the market at 4:30 a.m., are traded in bulk 'by-the-lot' packages, then flow to discount stores and street vendors nationwide, with resident African traders shipping whole truckloads to Africa.

Key Points

  • Shijing Town in Guangzhou's Baiyun District concentrates over 10,000 surplus stock shops, where the industry says about 40% of China's apparel inventory is absorbed
  • Livestream return rates for some apparel categories can exceed 70%, and returned clothes can no longer be listed at full price, becoming a major new source of surplus stock
  • Trading mostly starts at 4:30 a.m., using the 'by-the-lot' bulk packaging method where buyers don't pick styles or sizes; porters charge 10 yuan per order to deliver to logistics

I. The Two Major Sources of Surplus Stock

Apparel surplus stock refers to brand-new, tagged genuine goods that failed to sell through full-price channels, and its existence is seen by industry players as a structural norm. There are two main sources:

First, brand overstocking. Apparel is highly seasonal, and brands must place production orders 3-6 months in advance. Unable to accurately predict sales, they tend to overstock to avoid shortages; goods get pushed to distributors, who push them to retailers, and after peak season large amounts of inventory sit in warehouses. This can happen with cheap T-shirts and high-end coats costing thousands of yuan alike.

Second, livestream e-commerce returns. Livestream return rates for some apparel categories can reach over 70%. Returned items have been unpacked and tried on, cannot be relisted at full price, and can only flow into surplus stock channels at low prices. This is also the direct reason many people have recently rushed into the surplus stock business—abundant supply, and mostly brand-new genuine goods.

II. The Terminal Station: Guangzhou Shijing

Whether northern inventory or southern surplus stock, brand clearances or livestream returns, most of it ultimately converges on Shijing Town in Guangzhou's Baiyun District. Markets like Qingfeng, Jindong, and Yinma form a continuous stretch, packed with over 10,000 shops. This place doesn't wholesale full-price goods or do retail—it specializes in 'clearance.' Brand end-of-season stock, factory leftovers, livestream returns, export overruns, and even slightly defective genuine goods can all find buyers here.

Shijing's market opening time differs from ordinary wholesale markets—4:30 a.m. Buyers rushing back to other provinces, livestreamers who need to go live in the afternoon, and middlemen sourcing goods for overseas buyers are all present at the same time. The market has porters similar to the 'shoulder-pole' workers of Wuhan's Hanzheng Street, waiting at floor entrances for work; packing, weighing, and delivering to logistics companies costs 10 yuan. African traders are a constant sight at the Qingfeng market, buying up goods and shipping whole truckloads back to Africa, profiting from the information gap between domestic low prices and African selling prices.

III. What Do the 'Middlemen' Earn?

The core of the surplus stock business is summed up as the information gap, but the practical barriers concentrate in three areas:

Sourcing. Information on truly good goods is not public and not online. Many warehouses are hidden in the complex alleys of Shijing's urban villages, where outsiders struggle even to find their way. This has spawned the profession of 'floor-running'—shuttling between markets and warehouses daily to collect sourcing information, then selling it to buyers.

Pricing. The most common transaction method in Shijing is 'by-the-lot': dozens or hundreds of items packaged into one lot, no picking styles or sizes, take the whole lot. How much of a lot is marketable inventory, how much is good export stock, and how much is unsellable dead sizes is entirely up to the buyer's judgment. Veterans can price goods in a short time by checking collar stitching, feeling fabric weight, and smelling inventory odor, while novices easily pay high prices for 'landmine' goods.

Downstream. The truly stable approach is to have downstream channels first—county-town discount stores, street vendors, online sellers—and then match upstream sources accordingly. Brands wanting to clear stock can't find buyers, discount stores wanting to stock up can't find low-price sources, and the middleman's value is connecting the two ends.

IV. The Circulation Chain and Entry Methods

The typical path of a piece of surplus stock: brand/factory inventory backlog → first-tier surplus stock dealer buys out the entire warehouse → second-hand trader matches information and resells → vendors, discount stores, online shops, or overseas buyers → consumers.

It's understood that newcomers have roughly four entry paths: the no-investment 'floor-running' middleman, earning tea money or commissions on transaction value, suitable for first getting a feel for the market; small-volume secondary wholesale starting at a few thousand yuan, with some stalls supporting minimums of 3-5 items, but only if you already have downstream channels back home; surplus stock livestreaming, fiercely competitive, requiring an account base or differentiated content; and overseas export, with large profit margins but requiring real overseas channels and logistics/customs clearance capabilities.

Common pitfalls include: mistaking cut-label OEM goods for brand surplus stock; hot items possibly making up only 30% of a 'by-the-lot' package; overstocking all at once and tying up capital in goods; and finding sources first and buyers later, ultimately getting stuck with the goods.

From an industry perspective, the existence of the surplus stock market corresponds to the apparel supply chain's need for inventory absorption: brands use it to quickly recover capital, downstream players get goods at low prices, and large amounts of clothing that might otherwise go unsold get a second circulation. For secondhand clothing and export trade practitioners, Shijing plays a role similar to a horizontal sorting and redistribution node—the low-price advantage of domestic surplus stock also forms the supply basis for overseas markets like Africa.

Source: Exposed! Unsold clothes from shopping malls aren't thrown away at all—their final destination exceeds everyone's imagination · Originally published 2026-03-17