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Amazon To Close Its Local Marketplace Business In China; Chinese Store To Only Feature Global Products Come July
Amazon Founder and CEO, Jeff Bezos. (David Ryder/Getty Images)
Amazon’s Chinese e-commerce business took an unexpected turn after it announced that come July it is exiting the local market place business. The company will now focus more on offering overseas products rather goods from local sellers.
The e-giant will shut down its Chinese marketplace and consumers logging in after 18 July onto its portal amazon.cn will only see goods from its global stores than products from local and third-party sellers.
The portal will continue running Amazon Web-services, Kindle e-books and products, operations that help ship good from across China to consumers overseas.
The company which has less than 1 per cent of the market share has been finding it difficult to contend with market leader Alibaba and JD.com. The pullout is considered a rare event for Jeff Bezos its CEO, who is known to weather considerable losses for long-term growth and gains can be seen as a major setback in the worlds largest retail market.
Amazon entered China in 2004, after buying a local online bookseller for $75 million and since then invested heavily in warehouses and data centres. It even ran programs to teach Chinese sellers how to get their goods to Amazon customers.
The company also tried luring its Chinese consumers offering prime membership program and free international deliveries but at the end couldn’t keep up with the steep discounts offered by its rivals.
According to a company spokeswoman, Amazon’s commitment to China will remain strong and continue to invest in the country.
She added that “it has been shifting the focus of its online retail business in the country to cross-border sales, which cater both to Chinese merchants selling to consumers abroad and to Chinese customers looking for high-quality goods from around the world.” reports Bloomberg.
The company is instead shifting its focus on the Indian market where it has invested billions in setting up various infrastructure and operations facilities. The company since its entry in 2013 has opened 50 warehouses.
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