Alibaba is continuing its expansion into offline retail after the Chinese e-commerce giant bought up more than one-third of one of the Chinese most prolific operators of hypermarket stores.<\/p>\n
The firm\u00a0announced\u00a0today it has spent\u00a0HK$22.4 billion (around US$2.88\u00a0billion) to acquire of\u00a036.16 percent in\u00a0Sun Art Retail Group, a Hong Kong-listed business that operates\u00a0446 hypermarkets across 224 cities in mainland China.<\/p>\n
The deal makes Alibaba the second largest shareholder in the business, which has a market cap of over US$10 billion. Ruentex, the shareholder that sold to Alibaba, will retain a\u00a04.67 share while French retailer\u00a0Auchan Retail owns a dominant 36.18 percent.<\/p>\n
The Information was first to report\u00a0on the investment before it was announced on Monday.<\/p>\n
The deal will draw inevitable comparisons to\u00a0Amazon\u2019s acquisition of Whole Foods for $13.7 billion this year, but that would be misplaced. The Whole Foods deal marked a major point for Amazon\u2019s entry into physical retail, however\u00a0Alibaba\u2019s move into offline began years ago and this is only the largest part of that strategy.<\/p>\n
Alibaba bought a 35 percent slice of department store operator InTime in 2014\u00a0and then gobbled up\u00a020 percent of retail giant Suning for $4.6 billion in 2015, but it foot the pedal on the gas in 2017. In January, it snapped up the remainder of InTime and took the company private, while\u00a0in May it invested in supermarket brand Lianhua.<\/p>\n
The focus of these deals is to offer a bridge between online and offline commerce, both for users and retailers themselves. Alibaba believes that it can use the colossal amounts of data it picks up through its e-commerce and payment services to improve the consumer experience in-store, while also optimizing fulfillment and stock management. Beyond online services like Tmall for brands and its Taobao marketplace, it can also leverage Alipay \u2014 its mobile payment service with over 500 million users \u2014 and Cainiao,\u00a0the logistics offshoot it recently took full control of.<\/p>\n
\u201cPhysical stores serve an indispensable role\u00a0during the consumer journey, and should be enhanced through data-driven technology and personalized\u00a0services in the digital economy,\u201d Alibaba CEO Daniel Zhang said in a statement.<\/p>\n
\u201cBy fully integrating online and physical channels together with our partners,
\nwe look forward to delivering an original and delightful shopping experience to Chinese consumers,\u201d he added.<\/p>\n
That\u2019s already playing out.\u00a0The Chinese internet giant operates its own hybrid store called Hema, where consumers can purchase items using unmanned payment checkouts or order them for delivery. Beyond a taste of the future, the store serves as an incubation lab where Alibaba can develop new ideas for retailers like Sun Art, InTime and Suning.<\/p>\n
Alibaba\u2019s new partners aren\u2019t slouches, however. Auchan also operates unmanned payment kiosk services in China. Together, the three investors in Sun Art pledged to introduce\u00a0\u201ca new shopping experience to China\u2019s 1.3 billion consumers.\u201d<\/p>\n
This retail convergence in China isn\u2019t only being driven by Alibaba.\u00a0Rival JD.com invested in Yonghui in 2015.<\/p>\n
–<\/p>\n
Source: BBC<\/p>\n","protected":false},"excerpt":{"rendered":"
Alibaba is continuing its expansion into offline retail after the Chinese e-commerce giant bought up more than one-third of one of the Chinese most prolific operators of hypermarket stores. The firm\u00a0announced\u00a0today it has spent\u00a0HK$22.4 billion (around US$2.88\u00a0billion) to acquire of\u00a036.16 percent in\u00a0Sun Art Retail Group, a Hong Kong-listed business that operates\u00a0446 hypermarkets across 224 cities […]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[106],"tags":[3496,139],"yoast_head":"\n