Amazon 'shuts' shop in China: What it means for India and more

1 / 9

Amazon 'shuts' shop in China: What it means for India and more

Amazon is finally giving up on Chinese online shopping market. Late last week, the Seattle-based company said that it will shut down its marketplace on Amazon.cn. The company, however, will continue to sell Amazon Web Services, Kindle devices and products Amazon Global Store. Here's all you need to know about Amazon's partial retreat from China, what it means for India and more ...

2 / 9

Starting July 18, Amazon.cn will no longer operate

Amazon is set to partially exit China. The company has informed its sellers in China that it will no longer operate its marketplace nor provide seller service. In a statement given to a Chinese website, Amazon said, "We are notifying sellers we will no longer operate a marketplace on Amazon.cn and we will no longer be providing seller services on Amazon.cn effective July 18.”

3 / 9

Amazon is not the first US company to shut shop in China, Walmart and eBay too have earlier sold their business in the country

Amazon's exit highlights the difficulties that American retail companies face in China — Walmart too struggled with its e-commerce operations there, before selling the division to JD.com in 2016. eBay exited China in 2006.

4 / 9

​Amazon's share in China's marketplace has fallen below 1%

According to Consumer research firm iResearch Global, Amazon's share in China's e-commerce marketplace is currently below 1%. Alibaba's Tmall marketplace and JD.com controlled 82% of the Chinese e-commerce market last year.

5 / 9

​Amazon struggled to compete with local players

Amazon entered China in the early 2004. However, the company struggled to compete with local rivals that often offered free shipping to buyers even for low-value purchases. Amazon on the other hand required users to meet minimum purchase value for free shipping.

6 / 9

​Amazon's exit from China leaves India as its only major market in Asia

Amazon's exit from China would leave India as its only major market in Asia. As in Southeast Asia, Alibaba-backed Lazada is the leading player with a near 46% market share, however, Amazon is expanding there. And as a report in Bloomberg says, "The pullback is the latest sign that Amazon is ceding China so it can focus on India, where it stands a better chance of becoming a dominant player." 

7 / 9

​India is also Amazon's largest market outside of the US

8 / 9

Amazon India reportedly had higher gross sales than Flipkart in the financial year 2018 According to iResearch report, Amazon India had higher gross sales than Flipkart in the financial year 2018.

9 / 9

​New FDI rules have made going tough for Flipkart and Amazon in India

Post the new FDI rules, things have got bit tough for foreign-backed companies such as Amazon and Flipkart (owned by Walmart) in India. Though both Amazon and Flipkart have rejigged their seller policies to deal with new FDI norms, the likely entry of Mukesh Ambani's Reliance is sure to increase competition.