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Alibaba, China’s dominant e-commerce company, will ship to South Asia.
Alibaba Group says more than 500 million Chinese consumers have registered to shop on its two online marketplaces, Taobao and Tmall, which together account for three-quarters or more of online retail sales in China. Recognizing that Chinese living abroad also will want to shop on those marketplaces, Alibaba this week launched a new service that will help merchants ship to consumers in South Asia.
Alibaba, No. 1 in the Internet Retailer Asia 500 says eight Chinese logistics companies are participating in the program. It will allow overseas customers to ship multiple orders on Taobao and Tmall to a location in China for consolidation and shipment to their overseas addresses.
Alibaba says the service could save up to 50% shipping cost for international customers. Shipping a 1-kilogram (2.2-pound) parcel to Hong Kong will cost around 20 yuan ($3.30) and to Malaysia only 32 yuan ($5.2) .The shipping time is from four days to six days.
Merchants won’t need to make any changes to their systems, as they will be shipping parcels to addresses in China. Shoppers will be able to track orders through their accounts on Taobao or Tmall. (Taobao is Alibaba’s main marketplace where more than 6 million mostly Chinese merchants sell; Tmall is geared to larger brands.)
Taobao and Tmall are both Chinese-language sites, so this service mainly targets Chinese-speaking people outside of China. According to Panli, a company that helps overseas customers purchase from Chinese web sites, there are around 50 million Chinese-speaking people living outside China.
The new service initially will ship only to consumers in South Asia, including Hong Kong, Taiwan, Singapore and Malaysia. Alibaba plans to expand the service, especially to other Asian countries, but has no current plans to offer a similar service for shipping to the U.S or Europe, an Alibaba spokeswoman says. “Alibaba will continue to evaluate the demand for this type of service by consumers in other markets and does not rule out rolling this feature out to other markets in the future," the spokeswoman told Internet Retailer.
China’s Ministry of Commerce estimated that online retail sales in China grew 67.5% in 2012 to more than 1.3 trillion yuan ($209.7 billion). Alibaba says sales on Taobao and Tmall surpassed 1 trillion yuan, or 77% of the 2012 total for China, in just the first 11 months of 2012. Alibaba has not reported a full-year sales figure for 2012.
For more on Chinese companies selling to Western consumers via the web, read “Direct from China,” the cover story in the August issue of Internet Retailer magazine. For a free subscription, click here.