E-commerce giant Alibaba continues to assemble its offline retail empire by expanding into home furnishings. Just before China’s lunar new year holiday the tech behemoth invested approximately RMB 5.45 billion ($866 million) for a 15 percent stake in Easyhome (居然之家), a Chinese furniture chain operator.
Alibaba would support the digitalisation of Easyhome’s 223 stores in China through its online membership and cloud computing technology, the company said in a statement.
On top of the RMB 5.45 billion investment from Alibaba, Beijing-based Easyhome secured an additional RMB 13 billion in fresh capital from 16 investors including Sequoia Capital, Boyu Capital and China Equity Group, according to local media reports.
The retailer plans to put that new cash to work opening over 100 stores, with a fresh focus on moving beyond top urban centres into fourth and fifth tier cities. Easyhome its fleet of big box stores to reach more than 600 by 2022. Founded in 1999, the furniture retailer is also involved in interior design, refurbishment and furniture materials supply.
Alibaba’s Jack Ma is realising his “new retail” concept
Alibaba’s furniture deal comes during the same month that China’s leading e-commerce player said it will invest $486 million in return for a 38 percent stake in hotel and retail big data provider Shiji Retail Information Technology, according to a report in Reuters.
That data-driven deal was preceded by a bigger ticket purchase in November, when the NASDAQ-listed firm agreed to pay $2.9 billion to become the second-largest shareholder in China’s top hypermarket retailer Sun Art Retail Group, which operates China’s RT-Mart and Auchan stores.
Alibaba has offline links with retailers of home appliances, supermarkets, clothing, F&B and now furniture, said the company in the statement. The e-commerce giant’s offline expansion is the realisation of the concept “new retail” introduced by Jack Ma in 2016.
Ma’s vision of “new retail” follows the now familiar theme of integrating online and offline retail experiences, but unlike most players, his Alibaba Group has nearly unlimited spending power to consolidate bricks and mortar assets under its high tech umbrella.
In July the firm debuted its staff-free Tao Cafe in which customers could pay for their refreshments via smartphone, and in December, Alibaba opened the first of its HEMA tech-enabled supermarkets in its home city of Hangzhou, while laying out a plan to open 2000 of the smartphone friendly grocery emporiums.
(Source:mingtiandi.com)
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