CHINA'S E-COMMERCE FIRMS TO SEE VC INVESTMENT FRENZY TOYEAR

AsiaInfo Services
06-23-2011
China's E-commerce Firms to See VC Investment Frenzy Toyear

BEIJING, Jun 23, 2011 (SinoCast Daily Business Beat via COMTEX) -- China's e-commerce firms are likely to see investment from venture capital (VC) firms this year stand 10 times the figure last year, predicted Ma Xiaohui (transliterated), vice president for Xiu.com, an online luxury product sales platform in the country.

Domestic e-commerce firms lured around USD 1 billion from VC investors in the entire 2010, said Mr. Ma, noting that the anticipated market bubble will take shape after traditional retailers kick off an online sales frenzy.

A bevy of firms in the manufacturing industry are looking to set up their own business-to-consumer (B2C) platform for business expansion or, include third-party online sales platform in their own sales network, making 2011 a year of an e-commerce spree.

Procter & Gamble Co. (P&G, NYSE: PG), one of the world's most renowned consumer products makers, has joined forces with a third-party mobile shopping platform operator to boost its online sales, disclosed people familiar with the matter.

P&G, which has launched a full-fledged online sales and logistics platform in the country, expects to diversify its sales network with the mobile shopping platform, pointed out vice president for the P&G partner.

The cooperation makes it possible for mobile phone users to place orders for the P&G products at the third-party shopping platform, said the vice president, adding that the US-based company will complete the remainder procedures such as products delivery after getting the orders.

Following the heels of P&G, daily chemical products makers are in talks with the P&G partner for a possible collaboration, according to the vice president.

Apparently, the expansion is quite reasonable. E-commerce has become a must for traditional giants now that consumers' spending habit changes in the wake of a penetration of mobile Internet.

Nevertheless, such an expansion is kind of excessive, to put it into a more reasonable way. Ling Guosheng, general manger for the online sales unit of Suning Appliance Co., Ltd. (SZSE: 002024), capped the compound growth rate of the online shopping market in China at more than 180% in a June 19 interview.

Suning sets an aim to push sales revenue from online sales platform up to CNY 60 billion in 2013 and CNY 300 billion in 2020 from CNY 8 billion this year.

The Nanjing-based company, which plans to increase the number of its logistics bases to 60 across the country by 2015, will spend CNY 1.2 billion-CNY 1.8 billion building six to eight cloud computing data bases within three years.

(USD 1 = CNY 6.46)

Source: www.yicai.com (June 23, 2011)

KEYWORD: BEIJING INDUSTRY KEYWORD: Internet & Online Services & Media SUBJECT CODE: Internet & Online Services
E-commerce
SinoCast China Business Daily news
SinoCast China IT Watch
e-commerce
B2C
platform
sales
expansion
bubble
VC
online shopping
revenue


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