NetEase’s Kaola.com announces to purchase $20 bn worth of goods overseas in coming years

NetEase’s retail site Kaola announced to have signed purchasing contracts of nearly 20 billion yuan with 110 businesses at the first-ever China International Import Expo in Shanghai this Tuesday. The online retailer featuring cross-border e-commerce also pledged to accomplish another $20 billion in global sourcing in the coming years, besides delivering the current orders.

Kaola has planned to further extend its warehouse in a bonded area from the current 1.04 million square meters to 1.8 million square meters, while making sure overnight delivery service could cover up to 70 percent of domestic consumers.

Ding Lei, the founder and CEO of NetEase, addressed a forum at the Shanghai expo, noting the era for the Chinese to buy from all over the world has just started. “In the next 10 years or even longer, China will be the best market worldwide. The size, width, and level of the consumer markets in China would be beyond all people’s imagination,” Ding said, noting the Chinese government’s support for cross-border e-commerce was also “unbelievable”.

“In the next two to three years, cross-border imports will help (foreign) brands break the monopoly (of the market),” Zhang Lei, the CEO of Kaola.com, told thepaper.cn, a Shanghai-based news portal.

According to Zhang, Chinese consumers previously tended to purchase merely a small selection of goods, like milk powder, paper diaper, luxury goods and upscale cosmetics, while now more articles of daily use and many less-expensive labels are being included into the shopping list, which would improve the quality of life and give a boost to many featured brands overseas.

From 2017, Kaola has announced major procurement plans in Europe, Japan and the United States. Last April, it’s reported by the South China Morning Post that in bid to compete with larger platforms like Alibaba Group and JD.com, Kaola announced plans to buy $3.18 billion worth of European products over the next three years, spreading across more than 2,000 brands, which it hopes will appeal to high-spending Chinese shoppers.