Woolworths is turning to China and hoping that they will want to be part of Australia’s largest supermarket chain. They plan to build a Woolworths storefront on Alibaba’s Tmall business-to-consumer online marketplace, coordinated by China-based eCargo Holdings.
eCargo will be tasked with coordinating Woolworths’ inventory, packing and distribution requirements and they will advise on brand entry strategy and more.
Woolworths has a small presence in China already after buying the alcoholic drinks distributor Summergate last year for $25 million.
As eCargo Chairman John Lau said, “We believe the food and groceries segment will experience huge growth in the coming years between Australia and China, as cross-border trade restrictions ease and the China Australia FTA takes effect.”
Others have, similarly, had their eye on the e-commerce market in China. Amazon, Macy’s and Germany’s Metro have all entered the online market platforms run by Alibaba and JD.com to cater to the growing Chinese design for imported consumer good. The Chinese e-commerce market has been forecast to more than double over the next three years to $1.5 trillion, according to NY based research firm eMarketer. And certainly, everyone, including Woolworths, wants to be part of that opportunity.