Walmart to Further Invest in E-commerce Business in China


Published Date : Jul 31, 2015

The e-commerce market of China has not been a very easy one for Walmart to crack into, however the American retail giant is in no way giving in. On the contrary, Walmart has begun investing a lot more towards the e-commerce operations that it had initiated there, and in a way has taken total control of a particular China-based online retailer. 

Walmart, on Thursday ended up purchasing the leftover shares of the Chinese company called Yihaodian. This was after it was seen that Walmart was already owing a 51% stake in this company. The financial terms and details have yet not been declared however, such as step will definitely enhance the chances of Walmart to expand in China. 

This move taken by Walmart became a possibility by the government of China’s latest decision that entailed the opening up of the e-commerce domain to a pool of international investors. In the month of June, a regulator from China removed the restrictions which stopped international investors from acquiring a cent percent share in any e-commerce activity within the country. Prior to that, potential international investors like Walmart could only enter joint business contracts, that too with local companies in China. Even if Walmart manages to penetrate into the Chinese market, gaining a considerable share in the face of existing fierce competition will end up becoming a challenging task for the retail giant. 

Other American e-commerce companies such as eBay and Amazon.com have been struggling in the competitive scenario involving the Alibaba group which happens to be the dominant online retailer in the country. As per a research firm based in Beijing, the Tmall.com website that has been started by the China based Alibaba holds a 60% share in the market.