By Jennifer Park
May 20 – Following its investment in online Chinese retailer 360buy.com last year, the world’s largest retailer Wal-Mart Stores Inc. is further expanding the scope of its online sales business in the market through the purchase of a minority stake in China’s emerging e-commerce company Yihaodian.
“By investing in Yihaodian, we’re continuing to establish a presence in this important e-commerce market, and are moving forward on fulfilling our aspiration of being the leading global multichannel retailer,” said Eduardo Castro-Wring, vice president of Wal-Mart Stores, Inc. and CEO of Wal-Mart Global e-Commerce and Global Sourcing.
Established in 2008, Yihaodian is a fast-growing online retailer selling groceries, consumer electronics and apparel. The company operates next-day delivery service for essential daily goods at competitive prices. It has 2,000 employees and over 75,000 SKUs with its logistics network bases located in Beijing, Shanghai and Guangzhou. According to the company, its annual revenue in 2010 amounted to US$123.8 million.
Wal-Mart’s representatives have acknowledged vast growth potential of China’s e-commerce market and have expressed confidence regarding the details of the deal with Yihaodian.
Yihaodian’s co-founder chairman Gang Yu also sees this as an opportunity to gain a competitive position in China’s e-commerce business by learning from Wal-Mart’s global business practices.
The deal is expected to close within 60 days since the signing of the deal on May 13. The exact terms of the deal and size of the stake have not yet been revealed.
Wal-Mart Stores Inc., a corporation that started out with a single store in Arkansas in 1962, now has over 300 stores in China and the country has developed into one of the retail giant’s largest sales contributors.