According to the Boston Consulting Group Inc., China’s internet retail market may soon be overtaking the one in the U.S. as the world’s largest. In 2010, e-commerce sales in China were at 476 billion yuan, as compared to 128 billion yuan in 2008.
The report further estimated that 44% of city dwellers in China will shop on the Internet in 2015, while 23% did this past year.
As the consulting firm said, “Internet access has far outpaced the reach of the top physical retailers. China’s massive geography hampers the effectiveness of physical retailing.” China’s online retailers are also doing so well because China has incredibly low shipping costs ($1 on average for a 1-kilo parcel as compared to $6 in the U.S.). In addition, income is rising throughout China, helping retail sales to increase.