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Alibaba: The Giant of e-Commerce

So, what are the parts of Alibaba owned by partially by foreigners and not?

E-commerce,the part that got listed in New York several days back。

This part of the Alibaba is majority-owned by foreign investors who,thanks to the embedded VIE structure of the company,have very little to zero say in the appointment of board members and the strategic directions Ma Yun and his buddies want to take for the company。In short,Ma Yun runs the Alibaba empire。
 
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the foreigners hold the majority of the shares. Yahoo and Softbank alone control more than 55 per cent. Chinese shareholders in the management board including Jack Ma hold 12 per cent, perhaps a little bit more. ...

You couldn't be more wrong. Please read: hxxp://aswathdamodaran.blogspot.tw/2014/09/alibabas-governance-by-politburo.html (replace xx with tt)

Here's an excerpt:
"Legal Structure: The corporate governance problem with Alibaba starts with its legal structure. As I have noted in my prior posts, if you buy shares in Alibaba, you are not getting a piece of Alibaba, the Chinese online merchandising profit-machine, but a portion of Alibaba, the Cayman-Islands shell entity that has a contractual arrangement to operate its Chinese counterpart. While the Chinese government has granted legal standing to that contractual agreement, at least for the moment, it reserves the right to change it's mind and if it does, Alibaba's shareholders will be left with just the shell."

Further:
"Management Powers: While the board of directors in publicly traded companies often fail in their obligation to protect the interests of stockholders, stockholders at least get to elect board members and have a say (nominal thought it may be) in the management of the company. With its partnership set-up, Alibaba has stripped even this minimal power away from stockholders, and the board will be named by a group of partners, which includes Jack Ma and his hand-picked partners. This is decision by corporate politburo, not through corporate democracy, but to give the Hong Kong Stock Exchange credit, they refused to allow Alibaba a listing with this set-up, but the NASDAQ NYSE seemed to have no qualms. In fact, given the NASDAQ’s NYSE's track record of going after large market cap listings at any cost, is there is any entity (Atilla the Hun? The Evil Empire?), with sufficient market capitalization, that the NASDAQ NYSE would refuse to list?

(In my initial version of this post, I had wrongly accused the NASDAQ for this listing sin and I apologize, since I am sure that the NASDAQ would never have been this craven)."

As you can see from above, only Jack Ma and his selected partners(all Chinese) have real power. This was one of the reasons why Hong Kong was not selected for its IPO. So you and Softbank are out of luck.
 
Chinese e-commerce giant Alibaba Group plans to invest 10 billion yuan (1.6 billion U.S. dollars) within three to five years to build thousands of facilities in rural China to tap rising demand in these areas, it announced on Monday. Together with Alibaba-backed Cainiao Network Technology, which invests 300 billion Yuan on logistics, the plan will greatly boost China's rural economy.

The facilities will include 1,000 "county operational centers" and 100,000 "village service stations" and will see Alibaba's network extend to one third of China's counties and one sixth of its rural areas. The centers will focus on improving logistics services and cultivating more buyers and sellers in rural areas.

"We hope people in rural areas can enjoy the same consumption choices as in the cities and talent can set up businesses in rural areas," said Zhang Yong, chief operating officer of Alibaba, which is on an expansion drive after its New York IPO on Sept. 19 raised 25 billion U.S. dollars and made it the world's second-largest Internet company in market value.

"We hope farmers can directly purchase materials from manufacturers to lower costs and sell farm produce all over the world without leaving home," he said.

China's online retail volume increased by 41 percent year on year to 1.85 trillion yuan in 2013, but the rural market has been identified as a new growth engine as urban demand for online shopping tempers.

Sales from rural areas on Taobao, Alibaba's major shopping platform, accounted for 9.11 percent of the total in the first quarter of 2014, rising from the 7.11 percent in the second quarter of 2012, according to a market report released by Alibaba on Monday.

Alibaba Vice President Gao Hongbing predicted that the size of the rural e-commerce market will reach 460 billion yuan in 2016.

Not so long ago, East Wind village in eastern China's Jiangsu province didn't have a lot going for it. The community mostly exported wheat, rice and soybean — and young men looking for a better life.

"Our village was a traditional farming village," says one of the residents, Sun Han. "People tilled the fields and raised pigs."

Then, in 2003, Alibaba launched Taobao, which allowed people far from China's major cities to sell products online. For East Wind, that meant a whole new industry: furniture.

Today, Sun Han runs a furniture factory along the village's "Internet Business Road." Sun's factory, one of more than 600 in East Wind that now make furniture, ships all over China and as far away as New Zealand.

"Now in our village, most people own cars," says Sun, 31, who wears a pink shirt, jeans and sandals. "Not only do they own cars, they compare who owns the better car."

China has nearly 3.5 million businesses selling products on Taobao. These companies, many of them mom-and-pop operations, employ millions of people across the country.

In East Wind village, shipping firms, paint manufacturers and veneer makers have sprouted up to support the furniture industry. Handsome Zhang — really, that's his name in Mandarin — jumped into the shipping business in 2011. In his first full year, he made $50,000 — a small fortune in rural China.

"As villages develop, they become stronger," says Zhang, who wears torn jeans, sports copper-tinted hair and drives a white Kia sports car. "Taobao drives the economy. It increases migrant workers' employment opportunities. It drives everything."

With his new wealth, Zhang, 25, dreams of touring America, though he's fuzzy on the itinerary.

"What's the capital of the U.S.?" he asks. "The Statue of Liberty is in Washington, right?"

Told it's actually farther north, Zhang says, "Oh, New York. I want to see New York."

In the meantime, Zhang enjoys eating out and singing in karaoke clubs while some of his peers are left to toil in factories and construction sites.

The transformation of East Wind village began about 400 miles away in Shanghai, where Sun Han stumbled into an Ikea one day.

"I saw a lot of Ikea furniture," says Sun, standing in his factory amid the whir of sawing machines and the shriek of packing tape being stretched across cardboard boxes. "I felt their structure was very simple, and the prices were pretty high. I thought if I produce and sell them, the profit would be pretty high."

Sun bought a bookshelf and found a factory to copy it. He'd already sold things on Taobao, such as prepaid phone cards, but he worried that he just didn't have the skills to run an online business.

But he taught himself how to be an Internet entrepreneur — and an effective one at that. In the beginning, in 2007, he says he made more than $1,500 a day with a staggering 100 percent profit margin.

Soon, everyone and his brother in East Wind was opening a furniture factory.

Profits have since come down to Earth. Xu Feng, who runs a veneer company here, says the furniture business is high-volume these days, but with much tighter margins.

"Market competition is very tough," Xu says. "Furniture producers are competing, and naturally they will push down the price of raw materials. So you need to lower your prices accordingly. The future will be very good. But competition will be even fiercer."

As for Sun Han, the man who knocked off Ikea, he's now trying to build his own furniture brand. He remains grateful to Taobao. Without the e-commerce platform, he says, East Wind village never would have changed.

"Young people would have kept moving to the cities and not coming back," he says. "The village would have been just old people and kids."


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Sun Han, 31, runs a furniture factory in East Wind, a so-called Taobao Village, where Alibaba's e-commerce platform helped create a furniture industry. Previously people in the village had mostly farmed wheat, rice and corn.

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Handsome Zhang — that's his real name in Mandarin --€“ runs a shipping company, one of many supporting businesses spawned by East Wind village's furniture industry. The shipping business helped Zhang, 25, buy this Kia sports car.

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Bringing the less-developed areas into economic productivity opens up a huge development potential for China.
 
After September quarter result announcement, Aibaba stock reached new high to $104+ per share. Revenue increased 53.7%. Is this real life? Incredible!

Alibaba Group Announces September Quarter 2014 Results - Yahoo Finance

HANGZHOU, China--(BUSINESS WIRE)--

Alibaba Group Holding Limited (BABA) today announced its financial results for the quarter ended September 30, 2014.

“We delivered a strong quarter with significant growth across our key operating metrics,” said Jonathan Lu, chief executive officer of Alibaba Group. “Our business continues to perform well, and our results reflect both the strength of our ecosystem and the strong foundation we have for sustainable growth. On our China retail marketplaces, gross merchandise volume for the quarter increased 49% and annual active buyers increased 52% year on year. We extended our unrivaled leadership in mobile with 217 million monthly active users on our mobile commerce apps in September and US$95 billion in mobile GMV for the twelve months ended September 2014. We are also encouraged by continued improvement of mobile monetization which demonstrates the strong commercial intent of our users.”

“Our financial performance this quarter was robust, with revenue growing 54% year on year,” said Maggie Wei Wu, chief financial officer of Alibaba Group. “We continue to execute our focused growth strategy, and the fundamental strength of our business gives us the confidence to invest in new initiatives to add new users, improving engagement and customer experience, expand our products and services and drive long-term shareholder value.”
 
The 1111 is coming. What's your prediction for the sales of the day?
 
“Go IOE” The best solution is to use cloud computing, rather than buy a new machine to replace lost original machine.

May 17, 2013, Ali Group, the last one in Alipay IBM small machine offline. This is since 2009, “to IOE” strategic milestone reveal a node, leaving only part of the Ali Group, Oracle Database and EMC storage. July 10, Oracle database systems use Taobao offline advertising, Taobao bid farewell to the Oracle database.

As a whole group of chief technology officer, Wang Jian Group is responsible for the annual IT budget and planning, he realized that the traditional IT vendors rely on making technology and its maintenance is no longer within the scope of Ali, their management, for example, large storage for customers Introduction basic is the “black box”, the customer can not be important to maintain self, “to IOE” solve problems affecting Taobao and Alipay long-term development.

In the case of Ali Baba “to IOE” successful background, Wang Jian’s view is: “Go IOE” not simply change the software and the hardware itself, but to replace the traditional IT technology and architecture with a new Internet technologies and architectures.

Wang Jian believes Ali “to IOE” success for three reasons: First, corporate strategy determination is strong enough; Second is the ability to persist in the end, and willing to take technical, organizational various risks; third is to have a sense of mission and team to accomplish a seemingly impossible task.

Q Why do Alibaba “to IOE” this thing? “Go IOE” experienced a kind of process?

A 2008 ~ 2009 years, I was doing the whole group of the budget, for the first time proposed a “go IOE” it. I am responsible for the whole group technology budget formulation, when you see Alibaba computing needs grow exponentially, with business growth and disproportionate when it realized that if there is no technological progress, it will certainly affect the company long-term development.

A budget is not just “money” issue, but consider how the Group’s future development, but also opportunities for technology strategic thinking. “Go IOE” is not a person’s decision, you need to analyze their business situation, what business is suitable to try to “go IOE”. Ali was lucky, then Taobao technical team willing to innovate, willing to try “to IOE” this thing, and it’s the first bear the technical and business risks. Process “to IOE” The process is technological development, such as Taobao formed a good basis Mysql database team, also established its own development database Oceanbase team. Now a team from each division, two-pronged approach, which is a great long-term investment, not grinding mill for five years is not out. When IBM Alipay last one small machine offline, the entire technical team is very proud.

When we consider the “go IOE” not only due to cost considerations, the most important is the need to meet future long-term development of enterprises, the traditional IT infrastructure hardware and software companies have been unable to meet the terms of embracing the Internet. Ali Baba’s successful experience shows that the original dependent IBM, Oracle and EMC systems can be built on Commodity PC, which for most businesses cloud-based platform to build IT systems cleared the way, so that they can completely embrace the Internet.

This process is most painful is to hurt people every day to work with you, my colleagues around you might learn is this skill, suddenly told him no use of your skills, this is a very painful thing. Cloud computing allows us across the threshold of some technical, but I think a lot of companies will not pass in front of me said Hom.

Q possibility of traditional enterprises “go IOE” How much? Which companies have “de-IOE” conditions and power?

A If the impact of cloud computing know enough, you will understand the “go IOE” is not a technical upgrade. Cloud computing to traditional IT and open source software is an impact, it is the choice changing times, rather than a technology strategy.

From the underlying hardware and software to proceed “to the IOE”, this thing every business should do. If you want to say a very straightforward answer, I will make a point: If companies feel that existing IT cloud services can not meet demand, so it is suitable for yourself “to IOE”, I think most of the traditional companies are not impossible and necessary to achieve their own “go IOE”.

“Go IOE” both the technical challenges, but also constrained market conditions, there is the opportunity cost, but also limited human resources. So to help the best way to solve the most traditional enterprises “go IOE” is cloud computing, the enterprise, this is a good path to long-term development.

Traditional enterprises, “Go IOE” are doing a choice, the choice whether to trust cloud computing is a public service, like the national power grid as trust companies. “IOE” itself is the software era or buy the product left the computer age, and to the cloud computing era, actually becomes a buy “computing” era, is not buying the “Computer” era, so should the way services IOE removed. This process challenge is whether to accept cloud your heart, not just technically acceptable.

Q What do you think “to IOE” personnel training process?

A Alibaba accumulated technology than many people imagine. We really have a lot of good talent, they are not only familiar with the business, understanding of technology is not generally comparable, more importantly, he is willing to “reform their lives,” not worried “to IOE” make their original skills to no avail. This is the ideal time to become more important than anything else.

Most businesses rely heavily on IOE technical personnel training a little “take their money to someone else to pay tuition, but give yourself wearing handcuffs,” China’s strong corporate demand for technology than any country or region in the world, so technically the challenge also exceeded them, it is our dependence on foreign IT hardware and software companies and lead us to lose a lot of opportunities for their own development, and foreign technology may not be able to solve the problem of Chinese enterprises. “Go IOE” experience shows that we now have an opportunity to put our needs and the money used to develop suitable long-term development of technology that allows IT to develop their own products around.
For our own personnel selection, Ali is very careful, many foreign manufacturers worked in top talent, and not easily receive a letter of appointment, along with others doing this is because in the enterprise, and in Ali break open sky with a sense of mission there are very different. “Go IOE” extremely right talent needed to bring out a decent team, the team everyone’s potential is gradually being excited out.
 
The 1111 is coming. What's your prediction for the sales of the day?

Alibaba alone?

50 billion yuan?80 billion yuan?100 billion yuan?

Your guess is as good as mine。:cheers:

By the way,Alibaba stock prices are scaling new highs。
 
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Alibaba alone?

50 billion yuan?80 billion yuan?100 billion yuan?

Your guess is as good as mine。:cheers:

By the way,Alibaba stock prices are scaling new highs。
I guess the sales of ALIBABA will reach around 60 billion yuan. As you know, 1111 has already become a shopping festival in China, total sales will surpass 100 billion of the day. Every platform wants to cut a piece of cake. JD.com, Vmall.com etc etc.
 
Next Up for Alibaba: The Giant 'Singles Day' Sales

By Bruce Einhorn November 05, 2014

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Photograph by ChinaFotoPress via Getty Images

Merchandise is prepared for Singles' Day online sales on Nov. 5, 2014 in Wenzhou, Zhejiang province, China

So far, Alibaba (BABA) is doing a good job living up to the hype that surrounded its record-setting initial public offering. The Chinese e-commerce company yesterday, Nov. 4, reported its first earnings numbers since its IPO raised a record $25 billion in September, and Alibaba’s sales for the quarter increased 54 percent, to 16.8 billion yuan. Although higher costs for integration of newly acquired businesses and other marketing expenses helped drive its earnings down 39 percent, to 3 billion yuan, that result was still better than many analysts had expected.

“The China retail business is proving to be a powerhouse,” wrote Rob Sanderson, managing director with MKM Partners, in a report published Nov. 4. China’s market, he added, offers “impressive growth even at a very large scale.”

Now that Alibaba has reported its first results as a public company, the next big event for the Chinese e-commerce giant comes with the fifth annual Nov. 11 “Singles Day” sale. Alibaba came up with the gimmick of using 11-11 to market to unmarried people, and it has quickly become a hit: Last year, the company’s sales on Nov. 11 spiked 83 percent compared with the previous year, to a record 35 billion yuan ($5.7 billion).

Just how successful has Alibaba been with Singles Day? That turnover last year was more than twice the gross merchandise volume of all U.S. sales online during the post-Thanksgiving Black Friday and Cyber Monday sales, according to Jeff Walters, a Beijing-based partner with Boston Consulting Group. As other Chinese retailers have jumped on the Singles Day bandwagon, total online spending on Nov. 11 last year was around 50 billion yuan.

This year should be even bigger, thanks to the growing acceptance of the Internet among Chinese consumers. The total number of shoppers online has increased about 20 percent, to around 360 million, according to BCG, which expects Alibaba’s TMall and Taobao to account for 70 percent to 80 percent of Singles Day transactions. China’s post office is prepared to deliver more than 90 million packages daily “one or two days after Nov. 11,” the People’s Daily reported yesterday. That’s about 40 percent more than last year.

Many newcomers are getting into the Singles Day action this year, with more than 30 automakers, apparel brands, and other companies taking part in Alibaba’s sales event next week. For instance, Tesla Motors (TSLA) will sell begin sales of its Model S on Nov. 11. Zara (ITX:SM) will participate for the first time, too, Bloomberg Intelligence analysts Praveen Menon and Ji Shi wrote in a report published Nov. 4.

Some retailers may be in for a bit of a disappointment. With only about 25 percent of the Chinese population shopping online, Singles Day creates an opportunity for Alibaba and its rivals to get new customers used to the idea of buying goods over the Internet. “The loud promotion of Singles Day across the internet helps [persuade] many of China’s netizens to try e-commerce for the first time,” BCG’s Walters reports. While the number of shoppers will surely increase, the amount each one spends is likely to drop 15 percent, “because promotions are becoming more common throughout the year, making Singles Day less ‘special.’”

Still, Alibaba isn’t giving up on its marketing gimmick. With such Chinese rivals asJD.com (JD) offering more Nov. 11 sales of their own, Alibaba is trying keep its edge by turning Singles Day into a worldwide event. The company plans to offer more than 1 million items to consumers outside China, it said in a Nov. 4 statement on its Alizila website.

BABA (Alibaba Group Holding Ltd)
$108.67 USD up 2.60 2.39%
 
I guess the sales of ALIBABA will reach around 60 billion yuan. As you know, 1111 has already become a shopping festival in China, total sales will surpass 100 billion of the day. Every platform wants to cut a piece of cake. JD.com, Vmall.com etc etc.

Those who invested in this are so lucky right now. I heard / read reports how there were hundreds of Chinese "instant millionaires" when Alibaba went public.

Damn i wish i had bought shares.
 
Those who invested in this are so lucky right now. I heard / read reports how there were hundreds of Chinese "instant millionaires" when Alibaba went public.

Damn i wish i had bought shares.
Yes, Alibaba did this. What you maybe don't know is that Huawei has already done this for years through the employee shares. Actually, Alibaba, Tencent, Huawei all went through from the very very hard time. So, those who have vision and wisdom deserved the fortune.

The next company you should keep up with to pursue some fortune is Xiaomi. They are trying to ask for $40 billion for further development. Amazing number and a company for miracle .
 
Yes, Alibaba did this. What you maybe don't know is that Huawei has already done this for years through the employee shares. Actually, Alibaba, Tencent, Huawei all went through from the very very hard time. So, those who have vision and wisdom deserved the fortune.

The next company you should keep up with to pursue some fortune is Xiaomi. They are trying to ask for $40 billion for further development. Amazing number and a company for miracle .

Thanks for the heads up. Will look into this.
 
Alibaba's '11/11' opening sales break record

China's Alibaba Group Holding Ltd broke a record when sales exceeded 10 billion yuan ($1.6 billion)within 40 minutes after the start of its "11/11"' online shopping spree on Tuesday.


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Workers at Hangzhou-based China's Alibaba Group Holding Ltd handle orders on the e-commerce giant's "11/11" online sales event on Tuesday, Nov 11. Shoppers placed a record number of orders on Alibaba's platforms within the first 40 minutes and sales exceeded 10 billion yuan ($1.6 billion). [Photo provided to chinadaily.com.cn]

The Hangzhou-based e-commerce giant upgraded this year's event into a global online shopping carnival by helping Chinese shoppers purchase overseas products and overseas buyers acquire goods from China.

Shoppers from 175 countries placed orders on Alibaba's platforms within the first 40 minutes of the largest online shopping event in China - and maybe globally - which falls on Nov 11.

Created on November 11, 2009, by Alibaba, 11/11, or "singles' day". The event was originally launched to tempt single people without partners to console themselves with some retail therapy, spurred on by massive discounts from retailers.

Last year, Alibaba, which had a record breaking IPO in the US in September, rang up total sales of more than 35 billion yuan with the event's 24 hours. About 13.7 million shoppers visited Alibaba's business-to-customer platform Tmall in the first minute of last year's Nov 11 shopping festival. Transactions in the first minute totaled 117 million yuan.

Alibaba refused to reveal the sales target for this year's event, but analysts said that the number is expected to be much bigger than last year because shoppers from more countries are involved.

"As China's e-commerce market becomes more matured, online platforms can't rely on Chinese consumers spending more and more each year on the same products. They need to expand their product range, which will increase the average purchase value in China, and they need to expand their customer base," said Neil Flynn, head equity analyst at Shanghai-based Chineseinvestors.com, a leading financial analysis firm of US-listed Chinese companies.

Expecting a strong performance from its Nov 11 shopping festival, Alibaba's share price on the New York Stock Exchange jumped from $100 on Nov 4 to $114.5 on Nov 7. In terms of market value, Alibaba is the world's seventh- largest company, overtaking General Electric Co and Wal-Mart, trailing only Microsoft, Apple and Google of the tech giants.

***

Say hello to the early indicators of China's consumption-driven, high-end manufacturing economy.
 
55 billion RMB achievable by midnight?:D
 
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