What do you do if somebody else is eating your lunch? Buy the whole restaurant.
That, in a sense, is how it went down for handset retailer Aisidi (002416.CN). It bought out its rival.
The move might have been inspired by Xiaomi’s success in selling millions of handsets a year online which has prompted others to follow in its footstep. Physical handset stores have been most heavily hit by the rise of e-commerce in China.
Aisidi signed a deal to acquire 90 percent of a Shandong based e-commerce firm, a leading handset vendor in the province, primarily through its cyber stores on Alibaba’s Tmall and Taobao platforms.
But Aisidi is not giving up its physical chain. Instead, it plans to combine the best of both worlds, as well as improve their efficiency through bigger scale and sharing of resources.
Indeed, brick-and-mortar stores and online shops serve different markets.
Aisidi’s physical stores will probably continue to play an important role in bigger cities and in selling higher-end models, but for price-sensitive customers and those in lower-tier cities (where setting up an outlet can hardly be justified), e-tailing may prove to be more effective.
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