Amazon Shutting Down Its Online Store In China

Global e-commerce giant Amazon is closing down its online marketplace in China this year by July 18. The online retailer now plans to focus on selling overseas products to Chinese customers rather than local goods.

Amazon says it will keep running other businesses in China, such as Amazon Web Services and Kindle e-books. The company will also continue with its cross-border operations where it ships goods from Chinese manufacturers to customers abroad.

From 18 July onwards, customers logging in to Amazon’s Chinese website, Amazon.cn, will only see a collection of goods from the global store, instead of products from third-party sellers in the mainland.

The latest move highlights how Chinese e-commerce rivals have made it difficult for Amazon to gain traction in the marketplace there.

According to consumer research firm iResearch Global, Alibaba’s ‘Tmall’ and JD.com controlled 82% of the Chinese e-commerce market last year.

Amazon will also reduce support for local sellers who offer products only in China in the next 90 days. The company will also review its fulfillment centers in the country and close some of them.

One of the major reasons behind Amazon’s dwindling business in China is the lack of competitive advantage over local rivals.

Unless a user was looking for specific imported goods that can’t be found elsewhere, there was no reason for them to pick the US e-commerce giant over Tmall and JD.com.

After the news of Amazon’s exit from China broke out, US-listed shares of Alibaba and JD.com increased by 1% whereas Amazon’s shares closed flat.

Also Read: 1.5M Users’ Contacts Uploaded By Facebook Without Their Consent