China’s largest e-commerce company, JD.com, is launching in Europe and is poised to compete with Amazon.
The online retailer is worth US$40 billion and started selling more than 100,000 products from high-end brands such as Apple and Samsung to groceries in six European countries, including the United Kingdom and Germany.
The service operates under the Joybuy brand and promises to deliver products in a matter of hours, similarly to Amazon.
This marks the largest overseas expansion for the Chinese retailer and cements its ambitions to compete with Amazon, which has established a strong position in the European market.
It initially tried to establish itself in Europe by setting up a smaller business called Ochama in 2022, but this failed to make headway.
The expansion comes at a time of slowing economic growth in China, where retailers are locked in intense competition as rapid deliveries become the norm in the nation’s densely populated cities.
Because of this, JD has turned to international markets, buying electronics company Ceconomy for €2.2 billion last year and also exploring bids with UK retailers Currys and Argos, but no deal was reached in either case.
A Netherlands-based China retail digital analyst, Ed Sander, told the Financial Times that Chinese players are going abroad because growth in the domestic market is “stagnating”.
JD is also hoping to catch up with Temu and AliExpress, which have been operating internationally for the past few years.
Unlike Temu and AliExpress, which are marketplaces for third-party merchants to sell through their platforms, JD emphasises its ownership of much of the inventory it sells.
“We’re a first-party retailer, we’re completely different to every other retailer based on our customer proposition,” Matthew Nobbs, U.K. managing director of Joybuy, told CNBC in an interview.
“So we don’t do any de minimus business. We’re a retailer, first, and foremost for brands, and that’s our core.”
“De minimis” refers to a rule in various countries that gives customs duties exemptions for low-value goods.
