Date
13 December 2017
Wal-Mart has been in China more than 20 years but it has a relatively small network of 430 stores. Photo: Internet
Wal-Mart has been in China more than 20 years but it has a relatively small network of 430 stores. Photo: Internet

Wal-Mart selling online unit to JD.com in bid for partnership

Wal-Mart Stores Inc. is tapping one of China’s largest e-commerce players to help it crack the fast-growing but competitive market instead of going it alone.

The Wall Street Journal is reporting that the world’s largest retailer is seeking a partnership with JD.com that involves the sale of its Yihaodian website to the latter.

Wal-Mart is selling a 5 percent stake in Yihaodian, the second largest online retailer in China after Alibaba Group Holding Ltd., for about US$1.5 billion.

In turn, the US giant will get access to JD.com’s delivery network and shoppers.

The Chinese retail landscape has become cutthroat as the economy slows and consumer buying behavior shifts online and to mobile-phone purchases much faster than in the US,WSJ says.

JD.com and Alibaba are battling for customers, promising delivery in under an hour in some cities and pushing into rural towns.

Wal-Mart has struggled to expand in the country, even though it gets about one-third of its US$482.1 billion in annual sales outside the US.

The retailer opened its first store in China in 1996 but only has about 430 there today, or one-tenth as many as in the US.

Foot traffic to Wal-Mart’s Chinese stores has fallen for nine quarters straight, though spending per trip is on the rise, according to the report.

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