Biz / Tech

Alibaba to expand supermarket presence across China

Alibaba said it has teamed up with 13 real estate developers to expand its Hema supermarket model across the country, looking to open 100 stores by the end of 2018.
Ti Gong

Alibaba said it has teamed up with 13 real estate developers to further expand its Hema supermarket model across the country in a bid to boost their presence in the new retail sector.

They aim to have 100 such stores across the country by the end of the year, compared with the existing 37 stores in nine cities.

Collaborators include Evergrande Group, Country Garden, Kaisa Commercial and FutureLand Corp.

Hema supermarkets offer fresh food and groceries together with dining spaces, all backed by the payment services from Alibaba’s financial affiliate, Ant Financial.

They also connect with shoppers within three kilometers' radius of their physical stores, allowing customers to place orders through the app and have their food delivered.

Hema is also seeking to include services such as laundry and hairdressers to cater to the needs of nearby residents.

“We’re looking to become a social hub that integrates various local services, instead of just a supermarket that sells fresh food, as we penetrate into more cities and neighborhoods,” Hema chief executive Hou Yi said.

Alibaba, as well as other Internet giants, hope to gain momentum in offline retail by either building their own presence, or through tie-ups with existing retail chains.

Tencent, for example, has invested in Yonghui Supermarkets, Wanda Commercials, Bubugao Supermarkets, and JD.com.

At the same time, Hema hopes to diversify its offerings, saying it will start the trial operation of smaller retail models such as convenience stores.

Real estate developers hope to combine shopping and casual spaces with Hema supermarkets and further leverage off Alibaba’s more than 500 million monthly active users.

The e-commerce giant’s data analytics capabilities also appeal to physical store operators that can help them target more specific customer groups.

Chongbang Group, which operates the Jinqiao International Plaza in Pudong New District — hosts of the first Hema supermarket — said the introduction of Hema has added foot traffic to the shopping space, bringing in an average of 3,000 to 4,000 additional young customers per month.


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