As most companies rush to grow their online presence, Alibaba is actively seeking to expand its offline footprint through its new manufacturing division, Xunxi.
The Chinese tech giant recently opened three new “smart” factories catering to online brands that need to boost their manufacturing capabilities. The initiative is being run by Xunxi in conjunction with Alibaba’s eCommerce site Taobao, according to Reuters.
“A lot of these small and medium-sized brands, their advantage is that they can adapt to changes in the market and meet consumer demand, but their disadvantage is in manufacturing, because their technology and skills are limited,” Xunxi CEO Alain Wu told Reuters at a media event for Alibaba’s mammoth annual shopping event, Singles’ Day.
Alibaba plans to grow the division by getting companies to use its services and learning which of its technologies can be scaled up, rather than just building more factories, said Reuters, citing Wu.
China’s Singles’ Day, which is scheduled for Nov. 11, is a 24-hour shopping marathon that boasts the biggest sales on earth of any day of the year. A recent survey of Chinese consumers by AlixPartners found that while shoppers have favored buying Chinese goods this year for patriotic reasons, foreign retailers should also enjoy a healthy sales boost.
In addition to garment plants, Alibaba also operates a 100-plus store supermarket chain called Freshippo, along with a hotel and shopping mall in Hangzhou, China. The conglomerate has also launched a product sourcing and data analytics service for convenience stores, according to Reuters.