SUMMARY
- Freshippo, Alibaba's grocery subsidiary, announces plans to open 12 new stores across mainland China's key cities.
- The expansion comes amid an increasingly competitive grocery sector, shared primarily by Alibaba and JD.com.
- This move aligns with Freshippo's forthcoming initial public offering, following its official separation from Alibaba.
Alibaba's grocery subsidiary, Freshippo, has unveiled plans to amplify its brick-and-mortar presence across mainland China, as per a statement released on Friday. This move surfaces as Freshippo gears up to part ways with its parent company, Alibaba, and prepare for its own initial public offering.
Freshippo, colloquially known as Hema in China, has set its sights on expanding its footprint in the nation's key metropolitan hubs such as Beijing, Shanghai, and Guangzhou, with plans to inaugurate 12 new storefronts.
The grocery sector has now turned into a fiercely competitive field in China's e-commerce landscape, largely dominated by Alibaba and its rival, JD.com. Just last week, JD revealed its initiative to establish a fresh business vertical for its grocery division, 7Fresh, helmed by a seasoned company stalwart.
Freshippo, in a bid to straddle the digital and the traditional, is striving to marry Alibaba's prowess in e-commerce and logistics with the more traditional, tactile experience of shopping. Customers are granted the option to shop online and avail themselves of home delivery, or to venture into their physical stores renowned for their fresh produce including, but not limited to, succulent lobsters.
Alibaba's decision to expand Freshippo comes on the heels of its restructure into six distinct business units three months ago, in an effort to reignite its growth trajectory. These units can attract external capital and make their own journey to the stock market. However, Freshippo is not part of these six units but operates as a separate, autonomous entity under Alibaba's umbrella. Alibaba has given the green light for Freshippo's initial public offering, though a specific timeline remains undisclosed. Freshippo currently boasts a network of over 300 stores sprawled across 27 cities in China.
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