Chinese e-commerce giant opens showroom

Associated Press

BEIJING

China’s e-commerce giant is stepping up its heated rivalry with bricks-and-mortar retailers with the launch of a five-story home-furnishings showroom in Beijing.

Alibaba Group’s Taobao, an Internet platform through which an estimated 3 percent of all retail sales in China pass, opened the showroom Friday for customers to try out sofas, tables and other big-ticket items before placing an order online with one of its merchants.

The mall is a new intrusion into the territory of China’s real-world retailers by e-commerce rivals that are growing so fast some suggest they could become the country’s leading retail force — its version of Walmart.

“The dominant retailer in China someday may be an online retailer,” said Morgan Stanley analyst Richard Ji.

Taobao says its Beijing mall is aimed at overcoming a hurdle hampering the growth of China’s Internet commerce even though online retailers offer significantly lower prices: Customers don’t like to buy furniture and other major items without examining them in person.

“It’s hard for people to shop for home furnishings if they haven’t seen them,” said Justine Chao, an Alibaba spokeswoman.

Alibaba Group also includes Alibaba.com, a giant business-to-business Internet commerce platform. The company, in which Yahoo Inc. owns a 43 percent stake, operates Yahoo’s China arm.

Global e-commerce outfits have struggled to gain a foothold in China in the face of aggressive local competition. eBay Inc. entered China by acquiring a local company but handed over control to Chinese managers. Amazon.com operates through a local partner, Joyo.