Alibaba announced yesterday that it is shelling out $3.6 billion for a controlling stake in Chinese grocery store chain Sun Art. The investment will increase Alibaba’s stake in Sun Art to 72 percent.
All of Sun Art’s 484 physical retail locations in China are now integrated into Alibaba’s Taoxianda and Tmall Supermarket platforms for groceries, as well as Ele.me and Cainiao, its on-demand food demand delivery app and logistics businesses, respectively. For customers, this means faster deliveries and larger selections, while giving Alibaba more sources of data it can use to improve its supply chain and business operations.
As they are both online retail giants, Alibaba and Amazon are often compared with one another, and it appears that the comparisons won’t end with grocery. Amazon, which purchased Whole Foods back in 2017, is also rolling out its own branded markets packed with technology meant to speed up the grocery shopping process — and gather more data as you shop to make it even faster.
As noted, the grocery sector overall has garnered a ton of interest since the pandemic. Online grocery shopping is projected to continue to grow to hit $250 billion in sales by 20205. Grocery delivery service, Instacart, has raised a ton of money and swelled its grocery gig worker “Shopper” ranks. Shipt has grown its delivery worker ranks as well in anticipation of the coming holidays. And third party delivery services like DoorDash and Uber Eats are expanding from restaurants into the grocery category.