Alibaba IPO inspires Chinese e-commerce ambition

Friday's historic U.S. IPO by Chinese e-commerce giant Alibaba has provided an occasion to reflect on the remarkable progress of the Chinese online marketplace.

In the era of e-commerce, the production, distribution and sale of merchandise in China have all become dramatically more efficient.

Take the order that Alibaba itself placed for 130,000 T-shirts celebrating the IPO. It wanted them to be produced in China and distributed worldwide by Friday.

A firm based in south China's Shenzhen took only 12 days to finish the task. But four years ago, the same firm needed more than two months to produce 120,000 T-shirts for a U.S. buyer.

The e-commerce industry has boomed in China, with its total trade volume exceeding 10 trillion yuan (1.6 trillion U.S. dollars) last year, including three trillion yuan in cross-border transactions.

In 2013, Alibaba handled about 250 billion dollars' worth of merchandise, more than rivals Amazon and eBay combined. Its total revenue reached 52.5 billion yuan (about 8.4 billion U.S. dollars), up 52.1 percent year on year, and its net income almost tripled to 23.403 billion yuan in the 2014 fiscal year.

Founded in 1999 in east China's Zhejiang Province, Alibaba Group on Friday rang the opening bell at the New York Stock Exchange, marking its IPO on Wall Street.

The IPO is believed to be the biggest in U.S. history, with Alibaba having set its price at 68 U.S. dollars per American Depositary Share on Thursday evening, raising 21.8 billion dollars.

"The successful listing of Alibaba shows China's indigenous third-party platform has reached maturity," said Li Guiping, a senior executive of DHgate.com, a major Chinese B2B e-platform in cross-border trade.

"It is like a cardiotonic injection for China's e-commerce industry," said Li, who hopes that a listed Alibaba can bring more new trade channels and exert more influence in the global market.

Yet Alibaba currently relies heavily on domestic market. The trade volume of its online cross-border trading platform AliExpress was only 2.4 billion U.S. dollars last year, although its cross-border business is growing rapidly in some countries, according to the company.

The capital raised through the IPO can help Alibaba increase its international market share rapidly, said Wang Guolu, general manager of a foreign trade firm that sold more than 200 million yuan's worth of mobile phones overseas through e-commerce platforms including Alibaba in 2013.

E-commerce still relatively lags behind in Asia, said Alibaba Vice President Gao Hongbing on Friday.

To correct that, Alibaba "looks forward to deepening cooperation with the Association of Southeast Asian Nations and jointly building an e-commerce economy," said Gao at the China-ASEAN Cyberspace Forum in south China's Guangxi Zhuang Autonomous Region.

It is not the only Chinese e-commerce firm with overseas expansion plans.

DHgate.com has just completed a fourth round of financing and is looking at introducing mobile terminal services in new markets, said Li.

JD.com Inc, China's second-largest e-commerce company after Alibaba, is also working hard to develop cross-border trade, said Xu Xinquan, a senior executive of the company.

Insiders estimate that China's cross-border e-commerce trade in 2016will reach 6.5 trillion yuan, double last year's volume.