Wal-Mart’s e-commerce push in China

June 28, 2011 10:13 AM

The world’s largest retailer is building an e-commerce headquarters in the world’s most populous country.

Wal-Mart Stores Inc. announced this week that it had reached an agreement with the government of Shanghai to establish an office in China’s leading commercial city to oversee Wal-Mart’s online retailing operations in China. The retail chain and the Shanghai government agreed to work together to train e-commerce personnel and speed the development of online retailing in China.

“The scale of online sales in China is expanding rapidly and is projected to match U.S. online sales in the next few years,” says Wan Ling Martello, executive vice president of Global Ecommerce, emerging markets, at Wal-Mart. “We are very optimistic about China's e-commerce market and its growth potential. With Shanghai as our Global eCommerce’s China headquarters, we look forward to offering Chinese consumers a wider selection of quality products at good value with a great online shopping experience.” The Shanghai headquarters will report to Martello and Scott Price, president and CEO of Walmart Asia.

The announcement of the Shanghai office follows Wal-Mart’s announcement last month that it had purchased a minority stake in Chinese online retailer Yihaodian. Wal-Mart has operated bricks-and-mortar stores in China since 1996.

Wal-Mart is following the lead of other U.S. retailers and e-commerce players in investing in China’s fast-growing online retailing arena. There were 161 million online shoppers in China as of December 2010, according to the China Internet Network Information Center, the government-authorized body that maintains the country’s Internet infrastructure. Forrester Research projects that e-commerce sales will reach $159.4 billion by 2015, up from $48.8 billion in 2010.

Among the U.S. companies that have announced investments in China this year are retailers Apple Inc. and Gap Inc., online payment service provider PayPal, a unit of eBay Inc., and group-buying site Groupon Inc.

Apple is No. 3 in the Internet Retailer Top 500 Guide, No. 6 and Gap No. 24.




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