China’s rapid expansion of internet access across rural areas is bringing rewards to Hong Kong eCommerce company Tom Group.
One of Tom’s core business activities is an eCommerce joint venture with China Post called Ule. The business has achieved a stunning 183 per cent increase in gross merchandise volume to RMB 6.56 billion in the first six months of this year compared to the same period last year.
“The business has achieved last year’s full year GMV in six months,” Tom Group chairman Frank Sixt said.
“The combination of the Mainland government’s efforts in encouraging domestic consumption and the rapid expansion of internet access in rural areas of the Mainland has created a unique opportunity.”
Sixt said Ule continues to expand its footprint in rural China.
“As at the end of June, more than 80,000 of China Post’s branded franchised stores in rural parts of most provinces across the Mainland had joined Ule’s eCommerce platform. These stores offer a wide range of products and services, from agricultural to electronics to rural finance products, meeting the daily needs of local consumers and improving their quality of life,” said Sixt.
“Ule also offers supply opportunities to brand owners to reach rural customers via its offline-to-online/mobile platform, bridging the rural and urban gap.”
Tom Group, which has other business activities outside eCommerce, reported revenues of $642 million and an operating loss of $102 million in the six months to June 30.