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Rural China Is Next Target For Alibaba’s E-Commerce Expansion

01 Sep

Rural China Is Next Target For Alibaba's E-Commerce Expansion

The Chinese e-commerce company, AliBaba Group, tends to explore the potential of the most populated country’s countryside.

Alibaba Group has taken an initiative to target China’s rural areas. The most populated country’s online selling enterprises are competing to enter the countryside. Alibaba news told that every morning at 7:30 am, Pang Weidong begins his delivery route for the company’s distribution center in China’s northeastern plan. His small truck steers through pothole-ridden roads to transport items, such as weightlifting sets and toilet paper.

Alibaba news today reported that Mr. Weidong has stated that he consumes a time span of approximately 540 minutes to supply 200 packages a day, while he drives at a slow speed of 40 miles per hour for the safety of goods and animals. Mr Weidong is one of those many drivers who have been hired by the Hangzhou-based organization’s logistics partners and its main rival, JD.com, to deliver in rural towns throughout China.

Alibaba breaking news confirmed that the two companies have succeeded together in capturing 80% share of the $440,000,000,000 retail ecommerce market in the country and plan to enter 100,000 villages in the next 10 years. Both are targeting rural side at the time when they are pressurized by shareholders to achieve new growth. The main cities in the South East Asian country are growing as marketplaces for electronic trading, with few new clients to log up.

Alibaba’s CEO believes that the frequent purchases and variety of offered products would help it continue its growth in the long term. Investors are worried that the slow economy and disturbed stock market might cut down consumer spending. Thus, its revenue increased at a slow pace in more than 3 years in the 3 months ending in June. JD.com’s officials claimed earlier this month that they expect the sales growth to decline this year.

China’s villages are capable of growing. Approximately 600,000,000 rural citizens have seen their incomes growing faster than the incomes of city residents, though they tend to be impoverished overall. In 2013, the region’s annual rural per capita income was about 8896 Yuan, which is far lower as compared to that of urban households who have earned 29,547 Yuan annually.

Many villagers have recently explored online purchasing after buying their first internet-connected smartphones in the past 12 months, often via government programs. E-commerce customers in China’s countryside are barely one third in population of cities. Alibaba’s officials should speed up its expansion process in the rural belt to retain its position in the corporate world.

Many analysts agree on China’s massive potential to grow in future. Minor setbacks cannot restrain the country from its possibility to grow. Many foreign companies also accept the country’s fate. Therefore, local companies are not willing to forgo the opportunity to support the economy in harsh times. Alibaba and JD.com are included in such companies.

 

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Posted by on September 1, 2015 in Ali Baba, Technology

 

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