For A Look To The Future Look At China
In many ways, you can sometimes get a look into the future by taking a peek at what China is up to.
For a long time, Alibaba has owned or invested in not just one but several logistics firms.
JD and Alibaba has invested in a luxury eCommerce in China, long before Amazon Luxury and TheRealReal came on the scene in the US.
Alibaba continued its investments in superstores (China: hypermarkets) with its $3.6B additional stake in Sun Art, the #2 player in that market. That gives it a controlling interest. There are hundreds of Sun Art hypermarkets throughout China making this not a tremendous acquisition. A hypermarket is essentially a full grocery store plus a full department store under one roof. Miles Thomas explains how hypermarkets differ from Walmart, for instance: “Slightly bigger (like for like considering community size, 100k-200k sq ft/10k-20k sqm size class, may have multiple floors), more bias to grocery especially fresh/wet counters, somewhat broader range of general merchandise/home improvement/car maintenance. Might anchor/operate a small mall of attached stores, might anchor in a bigger mall, or might be self standing. Not very different, but closer to continental Europe model.” (I haven't seen one myself!)
This is definitely an escalation in the grocery wars in China, something we are seeing in the US as well. In this case, Alibaba is playing catch up to other players like JD. Jason Greenwood points out that “China is light years ahead of the west in eCommerce - light years. Payments for a start. WeChat Pay is ubiquitous for example and it’s mobile first.” - Totally agree.
What does this mean as far as what's next for consumers in the Chinese grocery/retail market?
