Alibaba’s focus on digital commerce: Sun Art sale and South Korea joint venture

Alibaba is making big moves to focus on digital commerce by selling off its stake in Sun Art, a major retailer in China. Reports from Forbes say that Alibaba is letting go of over 70% of its ownership in Sun Art to a private equity firm called DCP Capital. This shift will come with a hefty price tag—Alibaba expects to take a $1.8 billion loss because of this move.

But why is Alibaba making this change? Well, the company is eager to transition away from physical retail in China and dive deeper into ecommerce opportunities globally. One of their new ventures includes teaming up with South Korean retailer E-mart to launch a joint shopping venture. This collaboration, as reported by the Wall Street Journal, will merge their separate ecommerce platforms, AliExpress Korea and Gmarket, into a new joint venture. It’s a 50-50 partnership, but the platforms will continue to run independently, according to a statement from E-mart’s parent company, Shinsegae Group.

These strategic moves by Alibaba underscore a broader shift in the retail landscape towards digital commerce. It will be interesting to see how these changes play out and what impact they will have on the retail industry as a whole.