Rajesh Jain and Dhruv Goel landed in China last week — but not to witness the Olympics. Their destination a bustling new centre, two hours drive south of Shanghai, that has recently shed its image as a laid-back paradise for pensioners and honeymooners. Today Hangzhou, is better known as the home of Alibaba, a relatively young Chinese Internet company that has swiftly grown to become the world’s largest business to business Internet operation.
In addition to the international e-commerce portal, www.alibaba.com the group founded in 1999 and still headed by former teacher-turned Net visionary Jack Ma, now includes a Chinese portal, a payment gateway Alipay with 90 million users, a pay-by-use software service for Chinese small businesses, Alisoft and a hugely successful consumer e-commerce portal www.taobao.com .
Jain and Goel were in Hangzhou in their capacity as Alibaba registered traders to attend the first ever “Export to China” Sourcing Fair organised last week, on the sidelines of the Small and Medium Enterprises Summit of the APEC (Asia Pacific Economic Cooperation) Business Advisory Council (ABAC). Their Mumbai based company MM Overseas deals in iron ore export — and thanks to the business generated after they showcased their offerings on the Alibaba portal, business with China has boomed.
Also in town was Ansif Ashraf, Kochi-based head of the Paradise Group which has offices in Hong Kong, Taipei (Taiwan) and Lahore Pakistan, for its trade in rubber and polymer products — and a joint venture with a Shanghai-based Chinese partner. On the concluding day of the summit, Ashraf joined nine other SMEs like himself to be honoured as the world’s top ten small business champions — all having seen their business blossom, after they harnessed the opportunity thrown up by the new cyber Silk Route created by Alibaba... a virtual ‘mandi’ in the tradition of the China’s historic and centuries-old trading ties with the rest of the world.
In the Hangzhou command centre of Alibaba.com, CEO David Wei showed me a huge digital display logging every single transaction on the portal, as it occurs... there were five million registered users world wide and five times that number in China — and as I watched the graph showed 1.3 million trades being conducted at that instant.
By acquiring the China edition of Yahoo, Alibaba had filled a key piece of the jigsaw that will help its audacious bid to challenge Walmart as the world’s biggest commerce operation — while giving it 250 million Net users on its home turf.
Looking for global face
But for it to take on global giants, Alibaba needs a global face — and footprint. Which is why in October last, Ma and Wei decided that the time had come to address the world’s other big bazaar: India. Today, a visit to the Alibaba portal will show that the only international channel it has created is an India-specific site. “This is our fastest growing operation — it is growing at 100 per cent — that is five times faster than our U.S. business,” says Arthur Chang, Vice-President, Global Sales. There are just over 10,000 registered Indian suppliers and textiles and jewellery seem to be the most popular items exported. In April, Alibaba formed a strategic partnership with a leading India media company, Infomedia, for a canny mix of traditional print as well as Internet options to tap the local SME space.
Not everyone who signs up at Alibaba does business with China — but the advantages are obvious. This month, a new thrust is evident: Export to China (ETC) is the new mantra — a bid to change the perception that China want to sell to, not buy from, the world.ANAND PARTHASARATHY