Haier Group and Alibaba Form Appliance Retail Partnership
Dec 10, 2013
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A new partnership between China-based appliance giant Haier Group and Alibaba Group will seek to create a system for delivering and installing household appliances and other large-sized goods in China. The partnership will leverage Haier’s supply chain management, logistics warehouses, and delivery and installation services with Alibaba’s e-commerce capabilities.
Alibaba Group will invest HK$2.822 billion (approx. US$364 million) into Haier Electronics Group Co., Ltd., a member company of Haier Group. HK$1.857 billion of the Alibaba investment will go into Goodaymart, a retail subsidiary of Haier Electronics, and a joint venture company will be established. Alibaba will eventually take a 24.1% stake in Goodaymart and a 2% stake in Haier Electronics.
“The future economy is an experiential economy wherein the user is no longer just a passive buyer, but an active participant throughout the entire process, and companies around the world need to adapt to this,” said Zhang Ruimin, board chairman and CEO of Haier Group. “The aim of this partnership is not simply to grow the Goodaymart business but ultimately to enhance the experience for all participants in the logistics industry.”
“The new economy is not the digital economy, but rather one that combines the real economy and digital economy, a true blending of 'virtual' and 'real',” said Jack Ma, executive chairman of Alibaba Group. “Only with the growth of the real economy can there be true digitalization in the digital economy.”
Haier Electronics' Goodaymart retail operation has nine shipping bases in China, along with 90 logistics delivery centers and 2 million square meters of warehouse space. It has also established 7,600 county-level stores, approximately 26,000 stores in various townships across China, and 191,000 village contact points. It has also established logistics and distribution sites in more than 2800 counties across China and operates more than 17,000 service points.
Alibaba operates Tmall.com, a business-to-consumer e-commerce platform, where 70,000 international and Chinese brands have established retail storefronts. Tmall.com's 2012 transaction volume exceeded RMB200 billion (approx. $33 billion).
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