Alibaba rewrites e-com playbook, while ZTO is sued over $1.4bn IPO

Photo: © Alexey Novikov

Two stories from the world of Chinese ecommerce today. First up, Alibaba is going into bricks and mortar – a reversal of its asset-light model with which it partnered with others to keep costs down. Now however, as the pace of growth has slowed, it is introducing a “new retail” strategy, by which it will build some test stores as well as partnering with some existing stores for online and offline sales. This Reuters article also notes that Alibaba is relying more on its logistics company, Cainiao. The fees paid to it went up 88% in the year to March.

Meanwhile, on the delivery side, courier ZTO Express could find itself in hot water. It is being sued by a US pension firm which claims that it exaggerated its profit margins before its $1.4bn IPO. The lawsuit alleges that the company kept some low-margin businesses – its delivery network partners –  off the books.