Published November 24, 2014
By Jim Tompkins
CEO, Tompkins International
A week after the Alibaba mid-September IPO, Alibaba Group President Jin Jianhang said, “Business-customer e-commerce in the agriculture sector, along with big data and cross-border e-commerce, will be the company’s main business focuses after the stock market listing.”
He also explained Alibaba’s commitment to developing a dedicated agriculture platform on Taobao.com that farmers can sell products on. It will also offer additional services such as marketing and logistics support, and product tracing.
These comments are important to Canadian farmers, even though they are not new thoughts coming from Alibaba. In fact, Alibaba has already been committed to expanding its presence in Canada:
- Alibaba has a long-standing philosophy of helping small business in China.
- Alibaba’s focus on cross-border trade, both from China to the world, and the world to China.
- Alibaba’s cold chain agri-food business has grown 18 times from 2010 to 2014, and it will be greater than $13 billion in 2014.
- Alibaba is harnessing the desires of the fast-growing middle and upper classes that are hungry and thirsty for delicious agricultural products. (For more on this, read the new book China’s Super Consumers by Michael Zakkour.)
A month after Mr. Jianhang’s comments, a delegation from Canada’s most populous province met with Alibaba in Shanghai. Brad Duguid, the Economic Development Minister out of Ontario, and Michael Chan (International Trade Minister) brought a surprise guest to the Alibaba meeting: Premier Kathleen Wynne.
As a result of this meeting, Alibaba can export a variety of Canadian products to China, including cranberries, corn, pork, beef, poultry, wine, and more. Due to Canada’s high quality of produce and high food safety standards, the “Made in Canada” label is valued and works well for the China market -and therefore for Alibaba.
In addition to Canadian farmers being suppliers to China, Canadian customers now have an ally in China. Contrary to many other retailers and retail platforms, Alibaba understands that Canada, Mexico, and the United States are three unique countries. Alibaba gets this better than most because it recognizes that China is not one marketplace, but rather comprised of 22 distinct market clusters. The number of Alibaba’s Canadian customers presently sits at 1 million, but this number too will grow.
What does all of this mean? Canadian suppliers and consumers have a huge opportunity to increase their interactions with Alibaba. Watch The Alibaba Effect video for a background on these increased interactions and understanding Alibaba. Learning how to leverage the power of Alibaba for both Canadian suppliers and consumers is a big deal. For Canadian farmers, it is clear that Alibaba is the door to China’s farmers market -the largest marketplace in the world. For Canadian consumers, not only is Alibaba the doorway into China (i.e., “the factory of the world”) but also the doorway into cross-border trade.