JD.com Inc (京東), China’s main e-commerce rival to Alibaba Group Holding Ltd (阿里巴巴), has started a service that aims to speed imports, such as electric toothbrushes and infant car seats, to consumers through free-trade zones.
The new JD Worldwide service will expedite deliveries of international goods to Chinese consumers, JD.com vice president Leo Li said, adding that the business would use the zones to make brands more available outside the biggest cities.
“While big cities are our traditional stronghold, we are expanding quite well in smaller cities and we think that will be a huge growth market for foreign brands,” Li said in e-mailed response to questions.
JD.com, which is backed by Tencent Holdings Ltd (騰訊), is betting on demand for direct sales of imported goods in a nation where counterfeits have plagued online marketplaces, including Alibaba’s.
Companies, including Nestle SA and Danone, have said they plan to work with China-based e-commerce providers on direct sales of infant formula after a 2008 scandal prompted Chinese to seek out foreign-made brands.
“Mothers are a key target group,” Li said. “Ensuring authenticity is both our challenge and opportunity.”
Chinese shoppers can use JD Worldwide to order goods from hundreds of brands and sellers in overseas markets, including Australia, France, Germany, Japan, South Korea, New Zealand, the UK and the US, according to a statement.
The service lets shoppers buy “without the typical inconveniences associated with international shipping, customs and language issues,” the Beijing-based company said.
The e-commerce company did not name which brands would be available through the service.
The new JD Worldwide service will offer 150,000 product categories from 1,200 brands, the company said. It will feature both direct sales by JD.com, and marketplace channels for merchants, including San Jose, California-based eBay Inc.
EBay will have a channel on JD Worldwide. Bigger rival Amazon.com Inc opened a store on Alibaba’s Tmall.com (天貓) last month.
EBay’s store on JD.com offers products such as Oral-B electric toothbrushes and Graco car seats.
China created the Shanghai area for simplified customs clearance in September 2013 and has announced plans for at least three more free-trade zones in Guangdong and Fujian provinces and the city of Tianjin.
“EBay is working to unlock better selection for Chinese consumers and expand the global reach of eBay sellers,” eBay vice president of global expansion Jean-Francois van Kerckhove said by e-mail.
In related news, Alibaba Health Information Technology Ltd (阿里健康) shares surged to a record high on plans to buy an affiliate’s online pharmacy business in a US$2.5 billion deal.
The transaction puts parent Alibaba Group on track to grab a bigger slice of China’s booming healthcare industry and would help it expand into prescription drug sales after the government permits them to be sold online.
Under the deal announced yesterday, the health arm will issue shares and convertible bonds to buy Beijing Chuanyun Logistics Investment Ltd (北京傳雲物流控股) from Ali JK Investment Holding Ltd, a wholly owned unit of Alibaba Group, and another investor in a deal valued at HK$19.4 billion (US$2.5 billion).
The deal adds a platform for sales by Web-based pharmacies, which can be integrated with the Tmall business. The parent held 38 percent of the health arm, according to data disclosed during its initial public offering last year.
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