Arab Today, arab today major ecommerce pioneer struggling to survive
Last Updated : GMT 11:25:35
Arab Today, arab today
Arab Today, arab today

Major e-commerce pioneer struggling to survive

Arab Today, arab today

Arab Today, arab today Major e-commerce pioneer struggling to survive

Beijing - XINHUA

Once described as \"China\'s Amazon,\" e-commerce website Dangdang.com is finding itself fighting to stay afloat due to rabid competition. The company started selling leftover stock on May 7 despite of an earlier strategy aimed at middle and high-end clothing. CEO Li Guoqing told the Beijing News that his company is struggling to balance its expansion. The price of Dangdang\'s shares has dropped from 35 U.S. dollars per share to less than 5 U.S. dollars, despite a booming e-commerce sector that has enjoyed average annual growth of 66 percent. Dangdang was founded in 1999, while its main competitor 360buy.com emerged five years later. In that time, 360buy has surpassed Dangdang, with its 2012 sales volume exceeding 60 billion yuan (9.69 billion U.S. dollars) compared to Dangdang\'s paltry 5.19 billion yuan. Other competitors, including Tmall, Suning and Yihaodian, have also outgrown Dangdang, leaving the company with a shrinking market share. Analysts have attributed the company\'s poor performance to a failure to map out appropriate strategies for business expansion. E-commerce analyst Li Chengdong said Dangdang\'s budgeting was unduly conservative in its initial stage of expansion, while its counterparts have boldly expanded through risky financing strategies. Li said his company, which got its start selling books, has been more cautious and prudent than other companies that head into the sector with nothing to lose or fear. The CEO said 360buy should target markets that differ from those targeted by Dangdang, rather than trying to dominate the entire sector, so that all companies can profit. Li\'s wife and company president Yu Yu said Dangdang has survived the competition and remains a leading brand, despite its sales slump. However, Dangdang\'s prices, product diversity and inflexible payment methods have stopped it from expanding as quickly as its competitors. Analyst Ding Chenling said the company\'s biggest problem has been its slow reaction in upgrading its business structure. The company\'s book sales, which serve as a pillar for the company, have been threatened by competitors, particularly 360buy, which has relied on a low-price strategy to beat its rivals. China\'s online book market is valued at 30 billion yuan, much less than the value of the home appliance market, but still enough to support Dangdang when it was still dominant. However, fierce competition has compelled Dangdang to diversify its business and improve its margins. Dangdang\'s business report for the fourth quarter of 2012 showed that its sales volume for general merchandise totaled 1.15 billion yuan, while book sales totaled just 930 million yuan. Yu said the data reflects the realization of Dangdang\'s diversification. Li said in March that garment sales will become the company\'s third-largest source of revenues following books and maternity products. However, Dangdang\'s general merchandise business is not expected to show impressive performance, as its counterparts\' general merchandise offerings are more developed and mature. In order to prop up its flagging sales, Dangdang opened an online outlet in October 2012 on Tmall, a B2C platform operated by Taobao, China\'s largest online retailer. Li admitted the decision was a compromise to preserve the company\'s development, as it lacks sufficient capital because of a long-time deficit. Tmall and 360buy took 52.1 and 22.3 percent of China\'s online shopping market, respectively, by the end of 2012. Dangdang, on the other hand, had a market share of just 1.2 percent. Although cooperation between Dangdang and Tmall may benefit both, experts believe it will ultimately impair Dangdang\'s brand value. The company\'s net deficiency in 2011, the year after it was listed in New York, was 229 million yuan. 2012 saw the deficiency grow 94 percent year on year in 2012 to 444 million yuan. Li said the company\'s losses will come to an end in 2013.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today major ecommerce pioneer struggling to survive Arab Today, arab today major ecommerce pioneer struggling to survive

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today major ecommerce pioneer struggling to survive Arab Today, arab today major ecommerce pioneer struggling to survive

 



Arab Today, arab today
Arab Today, arab today Designer Aql Faqih aspires to innovation

GMT 18:41 2017 Friday ,20 October

Designer Aql Faqih aspires to innovation
Arab Today, arab today Italy regions back 'big bang' autonomy

GMT 07:10 2017 Monday ,23 October

Italy regions back 'big bang' autonomy
Arab Today, arab today Etiquette expert underlines importance of gifts

GMT 17:52 2017 Sunday ,03 September

Etiquette expert underlines importance of gifts
Arab Today, arab today Iraq's Barzani isolated by his drive

GMT 04:36 2017 Tuesday ,24 October

Iraq's Barzani isolated by his drive
Arab Today, arab today Maltese demand justice for murdered

GMT 06:08 2017 Monday ,23 October

Maltese demand justice for murdered
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today World's deepest lake in peril

GMT 15:54 2017 Friday ,20 October

World's deepest lake in peril
Arab Today, arab today Ex-French minister Dati wants tough action

GMT 10:54 2017 Thursday ,19 October

Ex-French minister Dati wants tough action
Arab Today, arab today Lost Australia diver swam miles

GMT 19:09 2017 Monday ,23 October

Lost Australia diver swam miles
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today EU targets German carmakers

GMT 05:41 2017 Tuesday ,24 October

EU targets German carmakers
Arab Today, arab today Tesla to build wholly-owned plant

GMT 07:55 2017 Monday ,23 October

Tesla to build wholly-owned plant
Arab Today, arab today Sherine Reda frustrated of latest terrorist attacks

GMT 09:03 2017 Monday ,23 October

Sherine Reda frustrated of latest terrorist attacks
Arab Today, arab today Delhi braces for pollution 'airpocalypse'

GMT 16:07 2017 Friday ,20 October

Delhi braces for pollution 'airpocalypse'

GMT 08:12 2017 Saturday ,21 October

Donia Abdel Aziz aspires to return to cinema

GMT 18:15 2017 Monday ,16 October

British actress becomes fifth woman

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam

GMT 19:09 2017 Thursday ,19 October

Massacre fears spark race

GMT 10:46 2017 Saturday ,05 August

Nanis reveals simple ideas for home renovation

GMT 05:27 2017 Monday ,23 October

Travel plea for conjoined twins

GMT 12:54 2017 Saturday ,21 October

Malaysia Airlines picks new CEO

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 08:06 2017 Tuesday ,24 October

Second Palestinian mobile provider enters Gaza

GMT 16:53 2017 Saturday ,02 September

Mai importance of gifts during Eid Al-Adha
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday