Amazon to shut down its domestic marketplace in China

As per the sources, Amazon.com Inc is looking forward to shut down its domestic marketplace in China by mid-July. It is aiming at expanding its presence by selling overseas goods and cloud services in the world’s most populous nation.

Thus, the people shopping from Amazon in China will be unable to buy goods from third-part merchants in the country. They can order it from the United States, Britain, Denmark and Japan through Amazon’s global store.

Reportedly, the firm is likely to shut down its fulfilment centers, winding down support for domestic-selling merchants in China in the upcoming three months.

“They’re pulling out because it’s not profitable and not growing,” said analyst Michael Pachter at Wedbush Securities.

Ker Zheng, marketing specialist at Shenzhen-based e-commerce consultancy Azoya, said Amazon had no major competitive advantage in China over its domestic rivals.

Unless someone is searching for a very specific imported good that can’t be found elsewhere, “there’s no reason for a consumer to pick Amazon because they’re not going to be able to ship things as fast as Tmall or JD,” he said.

However, the Chinese customers can purchase the firm’s Kindle e-readers and online content. Amazon Web Services, the company’s cloud computing unit selling data storage and computing power to enterprises, will remain as well.

As a matter of fact, the Chinese online shopping website Joyo.com was bought by Amazon more than a decade back for $75 million, which changed the corporate image of the company in 2011 as Amazon China. Later, the company launched an online store on the Alibaba site in the year 2015.