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Alibaba Confirms Plans To Offer IPO In US

samzenpus posted about 7 months ago | from the big-guns dept.

China 93

hackingbear writes "China e-commerce giant Alibaba Group confirmed early Sunday that it plans to become a public company in the US. The proposed US IPO, which is expected to raise more than $15 billion, is a bid winning over Hong Kong stock exchange, which had been competing for the offering with US stock exchanges but objected to some of Alibaba's proposed listing terms. Founded in 1999 by former English teacher Jack Ma, the Hangzhou, China company, of which Yahoo owns 24%, provides marketplace platforms that allow merchants to sell goods directly to consumers controlling 80% of Internet e-commerce market in China."

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Oh Boy! (2)

amightywind (691887) | about 7 months ago | (#46501405)

Oh boy, more Chinese criminals operating in the US.

Re:Oh Boy! (1)

Anonymous Coward | about 7 months ago | (#46501607)

Oh boy, more Chinese criminals operating in the US.

Don't worry. The NSA will protect us all!

"provides marketplace platforms" (-1, Troll)

fred911 (83970) | about 7 months ago | (#46501425)

Translation, They have a website.

Re:"provides marketplace platforms" (5, Insightful)

Anonymous Coward | about 7 months ago | (#46501507)

Translation, They have a website.

Yes, in the same sense that Amazon "has a website", except that Alibaba is far bigger than Amazon.

Re:"provides marketplace platforms" (1)

Anonymous Coward | about 7 months ago | (#46502237)

A better comparison is ebay, amazon sells a lot of stuff directly to the consumer and has the market place features. Alibaba is like ebay in the sense that you have sellers and buyers, you're not buying from Alibaba, you're buying from a seller through Alibaba.

Re:"provides marketplace platforms" (2, Informative)

Anonymous Coward | about 7 months ago | (#46503675)

Ali Express is like Amazon Stores. It has fixed prices and Alibaba handles the payment processing and escrow, the vendor supplies the goods and handles delivery.

Alibaba.com is more like Craigslist, but for large industrial producers to list their wares, often without public pricing.

Re:"provides marketplace platforms" (1)

ahabswhale (1189519) | about 7 months ago | (#46502289)

It will have a similar market cap to Amazon. So, no, it's not far bigger.

Re:"provides marketplace platforms" (2)

Ed Avis (5917) | about 7 months ago | (#46503041)

I don't think market cap is a good measure of size. If it were, then during the dotcom boom various online pet food suppliers, etc, which had barely any assets, employees or customers, would have counted as 'bigger' than more boring companies with a much greater footprint in the real world. Similarly, a large company may head towards bankruptcy and as it does so its market cap heads towards zero. But even if it is sold for a nominal price of one dollar, it is still a big company by any reasonable measure.

Re:"provides marketplace platforms" (1)

lsatenstein (949458) | about 7 months ago | (#46512581)

Translation, They have a website.

Yes, in the same sense that Amazon "has a website", except that Alibaba is far bigger than Amazon.

And offers much better deals.

Re:"provides marketplace platforms" (2)

anubi (640541) | about 7 months ago | (#46502825)

Yup...

This is the arm for the little guy. [aliexpress.com] ; This one is for wholesale business [alibaba.com]

Its amazing what you can get over there. You can buy anything from a completely assembled product down to every little piece that goes to make one. I am currently looking into having some of my stuff replicated and sold through them.

The group's Board of Directors (4, Funny)

techno-vampire (666512) | about 7 months ago | (#46501433)

I presume that the Alibaba Group has forty directors running it, and that every single one of them has "sticky fingers."

Re:The group's Board of Directors (5, Informative)

SpankiMonki (3493987) | about 7 months ago | (#46501611)

LOL...good one. Wish I had a mod point.

In actuality, the Alibaba Group has 28 partners, and they are at the heart of the reason why the HKEx is refusing the IPO.

The listing terms that the HKEx finds objectionable are centered around the proposed structure of the company, which would allow their 28 partners to control a majority of the board [reuters.com] - even though they only own around 13 percent of the company.

Apparently, the HKEx regulators still cling to the quaint notion that small investors are important. I guess those HK guys have a thing or two left to learn about how real capitalism works.

Re:The group's Board of Directors (2, Insightful)

Anonymous Coward | about 7 months ago | (#46501875)

I guess those HK guys have a thing or two left to learn about how real capitalism works.

Are you referring to the kind of Capitalism we saw with Facebooks IPO? Stellar example indeed! A model in corruption is not something to boast about.

Re:The group's Board of Directors (1)

khallow (566160) | about 7 months ago | (#46502173)

Apparently, the HKEx regulators still cling to the quaint notion that small investors are important. I guess those HK guys have a thing or two left to learn about how real capitalism works.

Here, the Alibaba Group would be dirtying the pool for everyone. HKEx has better things to do than expedite one company's con.

Re:The group's Board of Directors (3, Interesting)

Animats (122034) | about 7 months ago | (#46502359)

The listing terms that the HKEx finds objectionable are centered around the proposed structure of the company, which would allow their 28 partners to control a majority of the board - even though they only own around 13 percent of the company.

Apparently, the HKEx regulators still cling to the quaint notion that small investors are important. I guess those HK guys have a thing or two left to learn about how real capitalism works.

There was a time when the New York Stock Exchange didn't allow that, either. They caved about a decade ago. Now, both Google and Facebook have two class "president for life" stock issues.

Re:The group's Board of Directors (3, Interesting)

mutantSushi (950662) | about 7 months ago | (#46502421)

The listing terms that the HKEx finds objectionable are centered around the proposed structure of the company, which would allow their 28 partners to control a majority of the board [reuters.com] - even though they only own around 13 percent of the company. Apparently, the HKEx regulators still cling to the quaint notion that small investors are important. I guess those HK guys have a thing or two left to learn about how real capitalism works.

Non-voting shares are pretty standard in public stock corporations world-wide. Indeed HKEx itself runs such schemes, namely it's OTC Clearing subsidiary: http://en.wikipedia.org/wiki/Hong_Kong_Exchanges_and_Clearing#History [wikipedia.org]

OTC Clearing Hong Kong Limited (OTC Clear) was incorporated as a subsidiary of HKEx in May 2012 for the purpose of acting as the clearing house for OTC derivatives in Hong Kong. Subsequently, HKEx, under the founding member programme, invited 12 financial institutions as founding members of OTC Clear, who in total hold 25 per cent of issued share capital in OTC Clear (in the form of non-voting ordinary shares) whilst HKEx holds the remaining 75 per cent. HKEx continues to hold 100 per cent of the voting ordinary shares of OTC Clear.

Many publicly traded companies listed in HK in fact have 75%+ of shares owned or controlled by one entity, which has the same net effect as non-voting shares, since such an ownership majority can impose it's will regardless. HKEx has intimated that their true concerns revolve around mainland Chinese court procedures not being amenable to minority shareholders, although if they want to push that, that kind of calls into question HKEx's entire raison d'etre. AFAIK, HK courts can still enforce transfers of shares themselves as judgements, and if HKEx is worried about things that go on outside of HK jurisdiction then most companies traded on HKEx shouldn't be listed there. Realistically, HKEx is known for allowing plenty of shady practices that make it a bourse of last resort, and maybe they decided to stand up here just so they have some pretense of respectability.

Re:The group's Board of Directors (1)

davester666 (731373) | about 7 months ago | (#46502473)

What do you mean? They would be "small investors" if they only own 13%, but they control the company...they would be the most important investors.

Re:The group's Board of Directors (-1)

Anonymous Coward | about 7 months ago | (#46501621)

I presume that the Alibaba Group has forty directors running it, and that every single one of them has "sticky fingers."

I fingerbanged yo mama and got some STICKY FINGERS. Smelly fingers too. Maybe she should see a gynecologist.

Re:The group's Board of Directors (1)

EvilSS (557649) | about 7 months ago | (#46502145)

I presume that the Alibaba Group has forty directors running it, and that every single one of them has "sticky fingers."

Actually, doesn't Yahoo own a chunk of Alibaba? I know they are tied up somehow.

Re:The group's Board of Directors (1)

cdrudge (68377) | about 7 months ago | (#46504477)

If only the summary had mentioned that Yahoo owns 24% of Alibaba.

Re:The group's Board of Directors (1)

EvilSS (557649) | about 7 months ago | (#46507765)

Like anybody reads the summary.

ebay? (2)

sharknado (3217097) | about 7 months ago | (#46501437)

Well if this gives Ebay a run for its money, I'm all for it.

Re:ebay? (1)

cdrudge (68377) | about 7 months ago | (#46504527)

With Ebay, it's always a gamble as to what exactly you're getting and the condition you'll get it. But it usually will get to you within a week. With Alibaba, it's a gamble as to what exactly you're getting, the condition you'll get it, AND how long it will take to get to you (if it ever does).

sell your Amazon stock (0)

Anonymous Coward | about 7 months ago | (#46501441)

Amazon sells most goods from China, but Alibaba will be able to underprice [bloomberg.com] Amazon. It has direct access to the manufacturers in China.

Short term, no problem. Long term, Alibaba beats Amazon.

I wouldn't want to be hanging onto Amazon stock right now...

But does this mean U.S. expansion in selling? (1)

SuperKendall (25149) | about 7 months ago | (#46501553)

Amazon sells most goods from China, but Alibaba will be able to underprice Amazon.

I totally agree with your point, but so far the move of listing on a U.S. stock exchange seems to mean just raising capital - not necessarily a greater expansion of U.S. sales.

I wouldn't want to be hanging onto Amazon stock right now...

I'm not sure why given that revenue drops seem to only make Amazon stock go up in value, not down. A strong competitor should REALLY raise the AMZN share price... :-)

On a personal note, I would really welcome a strong competitor to Amazon, because right now there just is not anyone filling that role.

Re: sell your Amazon stock (1)

kayaker01 (3569597) | about 7 months ago | (#46501901)

Transoceanic drones?

Re: sell your Amazon stock (1)

Opportunist (166417) | about 7 months ago | (#46503655)

The DOD called, they claim they have a patent on that shit.

Re: sell your Amazon stock (1)

K. S. Kyosuke (729550) | about 7 months ago | (#46504313)

Intercontinental Business Messengers? ;-)

Re:sell your Amazon stock (0)

Anonymous Coward | about 7 months ago | (#46502337)

Amazon sells most goods from China, but Alibaba will be able to underprice [bloomberg.com] Amazon. It has direct access to the manufacturers in China.

Short term, no problem. Long term, Alibaba beats Amazon.

I wouldn't want to be hanging onto Amazon stock right now...

Except that Alibaba doesn't sell to the consumer, they are just a market place like ebay, buyers and sellers. Sellers set the prices, not Alibaba.

Re:sell your Amazon stock (1)

relisher (2955441) | about 7 months ago | (#46502509)

Alibaba does not have the same insurance as Amazon, though, which would mean that purchasing an item from here would be risky. Until they improve upon this issue, I do not see Alibaba overcoming Amazon

Re:sell your Amazon stock (1)

Opportunist (166417) | about 7 months ago | (#46503661)

As if people care about that. If they did, the average EBay scam could not be pulled off, and yet it's still going strong, after years and years of the same trick being pulled on the same people.

Re:sell your Amazon stock (1)

gl4ss (559668) | about 7 months ago | (#46503425)

short term alibaba sellers can dodge US sales taxes and customs.

long term, no.

and are we talking about the stuff amazon sells directly or the stuff people sell through amazon?

Re:sell your Amazon stock (0)

Anonymous Coward | about 7 months ago | (#46503737)

Most Alibaba sellers are located in China and Hong Kong, so they don't have any obligation to pay US sales tax. Perhaps the buyer owes sales tax or import duty, but I am not a USAian, so I don't really care.

Alibaba (1)

wiredlogic (135348) | about 7 months ago | (#46501445)

No better place to get unlicensed [alibaba.com] Segway clones [alibaba.com] and other IP violating products.

Re:Alibaba (0)

Anonymous Coward | about 7 months ago | (#46501631)

Also a great place to go if you want to buy a metric ton [alibaba.com] of thermite ingredients [alibaba.com] .

Re:Alibaba (0)

Anonymous Coward | about 7 months ago | (#46501637)

"We sincerely welcome friends at home and abroad, and seek common development, create brilliant cooperation!"

Re:Alibaba (0)

asmkm22 (1902712) | about 7 months ago | (#46501641)

That's not a problem with Alibaba. It's an issue with China, in general. They've never been very good at original thinking, at least not in the last few hundred years. They have been good at imitation, however. Probably because they make all the legitimate stuff for us. I imagine trade secrets and product specifications flow pretty freely between manufacturers in that country.

Re:Alibaba (1)

Dr Max (1696200) | about 7 months ago | (#46502297)

Japan tried the same trick for a decade or two, before then taking over the industries they were imitating.

Re:Alibaba (0)

Anonymous Coward | about 7 months ago | (#46502313)

That's not a problem with Alibaba. It's an issue with China, in general. They've never been very good at original thinking, at least not in the last few hundred years. They have been good at imitation, however. Probably because they make all the legitimate stuff for us. I imagine trade secrets and product specifications flow pretty freely between manufacturers in that country.

The better "counterfeits" are generally made in the same factory as the real stuff. They'll get paid to run the factory for 12 hours a day to meet US demand. Then when the US owners leave, they bring in another shift and run for the local market (which then ends up in the US on ebay).

Re:Alibaba (1)

nospam007 (722110) | about 7 months ago | (#46504105)

"That's not a problem with Alibaba. It's an issue with China, in general. They've never been very good at original thinking, at least not in the last few hundred years. They have been good at imitation, however."

Did they steal industry equipment and Nazi rocket scientists in WWII too?

Re:Alibaba (1)

K. S. Kyosuke (729550) | about 7 months ago | (#46504341)

Yeah, right, a few guys with expertise in a narrow area getting US passports is great comparison for the kind of lack of inventive thinking you see in China.

Re:Alibaba (0)

Anonymous Coward | about 7 months ago | (#46512211)

Yeah, right, a few guys with expertise in a narrow area getting US passports is great comparison for the kind of lack of inventive thinking you see in China.

LOL coming from a Jap.

IP Rights (0)

nurb432 (527695) | about 7 months ago | (#46501687)

Are for losers. Some of us dont believe in them. At all.

Re:Alibaba (1)

Frosty Piss (770223) | about 7 months ago | (#46502103)

No better place to get unlicensed Segway clones and other IP violating products.

I suppose because Segway the first fairly successful version, no one else can make one? I seem to recall that the idea here of Mac clones were touted as perfectly acceptable, but of course Apple is Evil.

Sex Robots? (0)

Anonymous Coward | about 7 months ago | (#46502255)

And what about sex robots?

Alibaba is bigger than Amazon and Ebay combined (2, Informative)

Anonymous Coward | about 7 months ago | (#46501475)

Alibaba’s portals handled gross sales of $170 billion in 2012–that is more than eBay and Amazon’s gross sales combined. [forbes.com] .

Alibaba is HUGE. Every US online retailer should be scared. Alibaba has the potential to take them ALL down.

Re:Alibaba is bigger than Amazon and Ebay combined (1)

alexander_686 (957440) | about 7 months ago | (#46501957)

Is that a fair comparison? IIRC Alibaba does a huge amount of b2b stuff – which has a large notional value but a very thin payout for Alibaba.

Re:Alibaba is bigger than Amazon and Ebay combined (1)

EvilSS (557649) | about 7 months ago | (#46502135)

Alibaba’s portals handled gross sales of $170 billion in 2012–that is more than eBay and Amazon’s gross sales combined. [forbes.com] .

Alibaba is HUGE. Every US online retailer should be scared. Alibaba has the potential to take them ALL down.

Yea, but a big majority of that volume is wholesale and B2B. There's Alibaba Express, their eBay like site that caters to consumers but the vast majority of their main site listings are for wholesale lots of... well, damn near anything. Need 60 tonnes of rice? They have you covered. 3000 pairs of jeans? No problem. Inflatable military tank decoys? Yep, they got those too. Can we put you down for 500?

Opions from China (2, Interesting)

Anonymous Coward | about 7 months ago | (#46501503)

Opinions from customers of Alibaba in China are, from what I've heard, that their delivery service leaves a whole lot to be desired. Considering that for growth they'd have to expand outside of China, and compete with Amazon's seemingly unstoppable growth and awesome customer service, with a business model that covers both direct sales and third party listings almost seamlessly, I'd not bet be entirely willing to be on Alibaba. I'd wish them luck, I want someone to compete with Amazon. But I'd not place money on it.

Combined with an exchange, closer to home, losing out for having "objected to some of Alibaba's proposed listing terms." It reminds me a bit too much of The Wolf of Wallstreet. If they're so successful why would they need to raise $15 billion other than for a cash-in?

Alibaba and the thieves (5, Interesting)

frovingslosh (582462) | about 7 months ago | (#46501559)

I made the error of buying a few items through Alibaba. Everything is either misrepresented, falsely speced, defective or counterfeit. While Alibaba maintains the pretext of settling disputes with the thieves, they always side with the thieves, so much so that the thieves don't even bother to dispute customers claims, they know that Alibaba always sides with them anyway. Avoid buying anything through Alibaba or buy one share of stock, if you can manage to go to the shareholder meeting and try to hold people accountable.

Re:Alibaba are fairly business man (5, Funny)

Anonymous Coward | about 7 months ago | (#46501761)

Alibaba are understand good seller and all for American company and abroad. As Amwerican many buyer I estanblish Alibaba as best.

John R. from America

Re:Alibaba are fairly business man (0)

Anonymous Coward | about 7 months ago | (#46501795)

Ok, that was perfect! Thank you.

Re:Alibaba are fairly business man (0)

Anonymous Coward | about 7 months ago | (#46503101)

Do you know Steve from California?

Re:Alibaba and the thieves (0, Informative)

Anonymous Coward | about 7 months ago | (#46501785)

I'm in the US and have ordered about 20 items from Alibaba in the past for the most part I've had good experiences with the site. When talking about the site with others I refer to it as the Chinese ebay. With that said, just like ebay you have to read the reviews, if there are no reviews then you're pretty much rolling the dice which I usually do not do, I stick to buying items with many reviews and from sellers with again many reviews.

they remove the bad reviews (3, Informative)

frovingslosh (582462) | about 7 months ago | (#46501861)

Bullshit. They remove the bad reviews. Don't take my word for it, read what others say on Reseller Ratings.

Re:they remove the bad reviews (0)

Anonymous Coward | about 7 months ago | (#46502217)

You butt hurt bro? Get that stick out of it and it'll begin to heal.

Everyone has had bad experiences buying from one place or another, no one ever enjoys the experience, the thing to do from the experience and learn from it instead of throwing a tantrum.

You are not buying from Alibaba you are buying from a seller using Alibaba. I've had bad experiences using ebay, that doesn't mean I'm going to stop using it, that just means I'm going to learn from the experience so I don't go buying from every tom, dick and harry.

Read the reviews of what you're buying, if there are none, don't buy it.

Re:they remove the bad reviews (1)

Anonymous Coward | about 7 months ago | (#46503407)

Maybe you should learn understand what you read. If the reviews are faulty (they're being censored), they aren't trustworthy and you can't go by what they say. The problem isn't bad sellers, the problem is there's no way to tell the bad sellers from the good sellers.

Re:they remove the bad reviews (0)

Anonymous Coward | about 7 months ago | (#46503667)

I've seen plenty of bad reviews on that site. But that must have been in the 5 minute window between posting and censoring right?

Re:Alibaba and the thieves (0)

Anonymous Coward | about 7 months ago | (#46502029)

In fact pretty much everything I see on e-bay is just the same sellers from Alibaba cross-posting their stuff on e-bay. At least in a few cases it's importers in the US or Canada ordering stuff from e-bay and re-selling locally. In that case I sometimes prefer to deal with someone shipping from inside the same country, which is about the only difference between the 2 sites. Buyer beware, and don't spend more than you can afford to lose.

Re: Alibaba and the thieves (1)

astar (203020) | about 7 months ago | (#46507631)

I have an account on alibaba. You can order quantity 1. You can have it dropped shipped. Delivery time is reasonable. Your own logos if you want on box and carton. Preloaded software images. But suppose the manufacturer decides you are not going to be a repeat customer? Your product get picked from the floor sweepings. That way in the US also sometimes. Let us think a bit.

Re:Alibaba and the thieves (0)

Anonymous Coward | about 7 months ago | (#46501787)

I bought some stuff with them and other than my country's postal service taking months to deliver the items I had no problems whatsoever. I always buy from people with good ratings, though.

15 Billion for what? (2, Insightful)

Anonymous Coward | about 7 months ago | (#46501813)

If they IPO in the US they will have to be held accountable to consumer protection laws. Right now the credit card companies are holding the bag for incorrect items delivered, and faulty merchandise. About 1/2 of the Items I have ordered from them have actually arrived and 1/2 were actually the product I ordered. I ordered 16 186500 batteries once and received 64 AA batteries. I charged back the order with my credit card company.

Re:15 Billion for what? (1)

fuzzyfuzzyfungus (1223518) | about 7 months ago | (#46501897)

Alibaba is mostly (possibly entirely, I don't know how much if anything they sell on their own account) the middleman. I'd be fairly surprised if they don't make it past 'consumer protection' (such as it is) pretty much entirely unscathed. Maybe they'll even add an abusive mandatory binding arbitration clause!

Re:Alibaba and the thieves (1)

Anonymous Coward | about 7 months ago | (#46501845)

Mod parent overrated. Cheap things are cheap. I've purchased heaps of things and when there were problems alibaba stepped in and refunded me without me lifting a finger to do so. Goods were not shipped in a timely fashion and I was refunded. Pretty much everything has been as described (albeit in poor english).

Re:Alibaba and the thieves (0)

fuzzyfuzzyfungus (1223518) | about 7 months ago | (#46501867)

So Ebay, but with lower transaction fees?

Re:Alibaba and the thieves (2)

PhrostyMcByte (589271) | about 7 months ago | (#46502373)

I guess it's a bit of a crapshoot if you get a bad seller, but the fact that prices are 1/4rd of what you'd pay to buy something similar domestically is a pretty good lure.

I've ordered twice from Ali Express -- once for a RTL2832 tuner, and once for a mini-Gorillapod knockoff. Both times I received exactly what the page advertised, in perfect condition and they continue to work great today.

Actually I've had refunds from Alibaba... (0)

Anonymous Coward | about 7 months ago | (#46502891)

Having bought a few things through Alibaba/Aliexpress I've had no real issues
Sure, some stuff is cheap, but it's fairly easy to tell that from the photos if you're paying attention. A lot of stuff is fairly decent though.
I had one order that was really not as described. Got a refund within a week of initial complaint with no requirement to return the defective stock (not that I kept it - was useless).
The only other issue I've had is the seller not using the postal service I requested. The item still got to me, just a week or 2 later than expected.

Re:Alibaba and the thieves (-1)

Anonymous Coward | about 7 months ago | (#46503307)

Listen, not all chinks are dishonest. Koreans come from Chinese stock and the christian gooks are perfectly nice and honest people. That is all.

Re:Alibaba and the thieves (1)

thegarbz (1787294) | about 7 months ago | (#46503559)

I've had success with everything I bought through Alibaba. Everything was exactly as listed on the packet, cheap Chinese crap, no different from what you get from eBay. None the less every bit of low quality gear I've bought from them has worked as long as expected.

Or did you actually think you were going to get top quality products for the prices you were paying?

Not my experience (0)

Anonymous Coward | about 7 months ago | (#46503809)

I've bought _many_ things through AliExpress the last couple of years. I have had exactly zero problems. Mostly electronics, and everything from a single cable to larger stuff. Once I ordered a suspiciously cheap android tablet, but got an email from AliExpress a few hours later saying that the order had been cancelled by them since the seller could not produce evidence that they had the actual products.
That said, there are certainly some counterfeit products there, but most of the time that's stated (as "not original") in the description. I think most people just doesn't read the descriptions carefully.

Re:Alibaba and the thieves (1)

AmiMoJo (196126) | about 7 months ago | (#46504991)

They are find if you just remember that everything, and I mean everything, is fake. Anything with a brand name is a knock off, but you pay 1/10th the normal price for it if you can put up with that. Anything without a brand name on it is also a knock-off, they just didn't put the fake brand sticker on it.

You can get some good stuff. Cheap electronics modules for hobby use. Surplus equipment, including rare stuff like nuclear batteries or old satellite equipment. I have a bladeless fan that looks exactly like a Dyson but isn't, and while being a bit loud it also cost 1/10th the price (£30 instead of £300) so I'm quite happy with it.

Not doing business in US? (1)

a_kibitzer (1173865) | about 7 months ago | (#46501583)

TFS/TFA indicate Alibaba is going to raise money through an IPO and be listed on a US stock exchange . No indication they are going to move into retailing in the US. Yet.

Re:Not doing business in US? (0)

Anonymous Coward | about 7 months ago | (#46513973)

A group of 23 sewing machine SDTA.com dealers from the USA met with the Director of External Affairs at Alibaba headquarters in Hangzhou earlier in March. We asked when they were bringing their platforms to the USA. She said they had just approved it all in a meeting the day before we got there and still had to come up with a name for doing business in the USA. You can bet that Marissa Mayer at Yahoo (with 24% of Alibaba stock) has all the details. Alibaba charges only 6% transaction fees to their partners in China vs the 15% that Amazon charges to partners here. It's not just the lower prices of merchandise that moves mountains and stock prices. JMD.

Generally Accepted Accounting Principles - GAAP (1)

pcwhalen (230935) | about 7 months ago | (#46502383)

Which they don't follow. http://www.investopedia.com/te... [investopedia.com] There's ALL sorts of games you can play with revenue recognition alone.

Anyone here want to rely on Chinese accounting practices? http://www.chinaaccountingblog... [chinaaccountingblog.com]

There are no securities laws in China similar to those in the US that require transparency so investors know what they are buying.

Hell, this will be a great IPO, just flip it on the first day. Make your profit and watch it crash.

And now to illustrate: the classic accountant's joke.

There once was a business owner who was interviewing people for a division manager position. He decided to select the individual that could answer the question "how much is 2+2?"

The engineer pulled out his slide rule and shuffled it back and forth, and finally announced, "It lies between 3.98 and 4.02".
The mathematician said, "In two hours I can demonstrate it equals 4 with the following short proof."
The physicist declared, "It's in the magnitude of 1x101."
The logician paused for a long while and then said, "This problem is solvable."
The social worker said, "I don't know the answer, but I a glad that we discussed this important question.
The attorney stated, "In the case of Svenson vs. the State, 2+2 was declared to be 4."
The trader asked, "Are you buying or selling?"
The accountant looked at the business owner, then got out of his chair, went to see if anyone was listening at the door and pulled the drapes. Then he returned to the business owner, leaned across the desk and said in a low voice, "What would you like it to be?"

Re:Generally Accepted Accounting Principles - GAAP (0)

Anonymous Coward | about 7 months ago | (#46502423)

There's ALL sorts of games you can play with revenue recognition alone.

Do any of those games include Tron?

My story with Alibaba (4, Informative)

gwstuff (2067112) | about 7 months ago | (#46502499)

When Steve Jobs gave his first iPhone demo, I had my doubts when he claimed that you didn't need stylus pens with touch screens. Seeing the frenzy with which people wanted iPhones in the coming months, I decided to make an investment and buying a large quantity of stylus pens, whose price I expected would rise. I approached several vendors on Alibaba. The process was surprisingly smooth - most of the vendors seemed to have communication reps who were nice to talk to/interact with and knew their stuff very well. The prices were insane. I could buy pens that could be purchased for $30 in the US for 10 cents a piece, if I bought then in bulk. For another 5 cents I could brand them, and for another 10 I could customize them. So I ended up buying 100k of them and having them shipped to a warehouse in Philadelphia, where I rented some space out for ~$50/month. My most memorable feeling from this experience was not the profit I made (not that much, it looks like a lot of other people had the same idea as I did...) but realizing how easy it was to get something custom-manufactured half way across the world, have 100s of thousands of pieces hauled across on boats to a few miles from where I live. Something Marco Polo would have marveled at... Alibaba is only the front end to an unbelievable system of proxy manufacturing.

Re:My story with Alibaba (1)

guises (2423402) | about 7 months ago | (#46503565)

So how did you go about selling the pens that you had? I realize that it's not the relevant part of the story, but you've gotten me all curious.

Re:My story with Alibaba (1)

gwstuff (2067112) | about 7 months ago | (#46506285)

I lacked information at the time, so I explored a number of fronts. It was clear that shipping and handling was going to be the biggest overhead in the business. Something like - 50 cents / pen, $5 -- $15 for shipping and handling, depending on the route I would take. There was also the question of whether to sell to retailers or to end consumers -- I opted for the latter and simply listed my product on Amazon. Shipping and handling would have been much easier today because nowadays Amazon offers managed plans for merchants. So you ship them boxes of your products, and they'll manage your inventory and pick 'n pack them on the way out. You can even qualify products for Amazon Prime, which as anyone who has Prime will guess is a big purchase incentive. At the time, you had to deal with shipping on your own, even though Amazon would actually reimburse a shipping cost (determined by them based on market rates) from their cut of each product sold. The alternative to Amazon was to make a web page and hook it up with a Paypal account, which would have been equivalent. Remember that the premise of this whole exercise was the hunch that there was going to be a supply shortage of pens. The whole plan was predicated on that hunch - I wasn't planning on trying to make a business out of this through aggressive Adword advertising, branding, or other type of marketing. I was reasonably confident that I would at least make my investment back over the next few years.

In today's world, you would also have the option of using something like easypost.com for managed shipping or shipwire.com for managed warehousing.

Re:My story with Alibaba (1)

guises (2423402) | about 7 months ago | (#46514259)

Huh. Well thanks, that side of business has always seemed opaque to me. That's easier than I expected, I'll keep that in mind if I get a hunch one day.

Re:My story with Alibaba (1)

advid.net (595837) | about 7 months ago | (#46503793)

I'm also curious : "how did you go about selling the pens" ?
Can you answer to guises (2423402) please ?

Re:My story with Alibaba (2)

Belial6 (794905) | about 7 months ago | (#46513685)

What I marvel at is how Chinese sellers can manufacture and ship a product from China to anywhere in the US via the USPS cheaper than I can ship the same product to the next city over.

Inside China Alibaba is not used (1)

ukoda (537183) | about 7 months ago | (#46502729)

I don't know what ratio of "Internet e-commerce market in China" is export vs internal consumption but the average Chinese person has little knowledge of Alibaba, they use Taobao. The basic point if the article is still valid as Taobao is part of the Alibaba group.

Making an online purchase is pain inside China if you don't speak Chinese. Alibaba Express is for export only, so blocks China as shipping destination. Inside China you are expected to use Taobao, but Taobao is Chinese language only.

Re:Inside China Alibaba is not used (3, Interesting)

Anonymous Coward | about 7 months ago | (#46503663)

Taobao is amazing. You can buy anything there. See people using Taobao, they are really effective, instant messaging directly with the seller drag'n'drop your item in the message, delivery time in many cases is a couple of hours, if you live in one of the big cities. It is a really smooth experience. It beats anything I have seen in the west so far. But of course, if you can't speak Chinese..

Re:Inside China Alibaba is not used (1)

Noah SILVA (3457047) | about 7 months ago | (#46504013)

That's (perhaps) a shame, but hardly unusual. Most web sites only support the local language - so just as most US web sites only support English and most Japanese web sites only support Japanese, one would expect that naturally most Chinese web sites would only support Chinese. To put it another way - what percentage of potential TaoBao users inside China would know another language (say English), but *not know* Chinese? Let's say well less than 1%? If Japan is anything to go by, only 1.7% of the population is foreign, and of those, over 95% speak Japanese. So you're looking at a potential market of a *Maximum* of 0.09% and for that you are going to translate your web site, all of your documents, hire bilingual staff (who will want a higher salary), etc., etc.? I don't think so. That's even assuming that everyone spoke the *same* different language (like English). If some spoke only German or Korean, etc., then the situation gets much more complicated. Just because you want it to be doesn't make it so. For all the talk of the "Global Platform" of English, the reality on the ground is that in most countries if you really want to get along you had better learn the local language, or expect to pay more for less and need help all the time.(Of course, English speaking countries like the US are no different here, as they expect you to learn English before coming).

Re:Inside China Alibaba is not used (1)

ukoda (537183) | about 7 months ago | (#46505715)

Yea, I would agree with that. I don't see any need for Taobao to change, it's for internal consumption so one language is fair. However general speaking I can't see any reason why Alibaba Express blocks internal sales, they had to go to the extra step of removing China from the long list of countries you can pick from. The only possible reason I could think of is because the Chinese government probably has different processing requirements for internal trade and exports and allowing Alibaba Express to do internal transactions would complicate things for very few sales.

Do you know the story of Alibaba? (0)

Anonymous Coward | about 7 months ago | (#46502789)

Bottom line of the fairy tale, Alibaba knew the treasure was stolen from other people but he kept it to himself.
He made no effort to return it to it’s rightful owners, instead he made every effort to hide and keep the stolen treasure.

What a fine, upstanding, moral man. Eh?

(plus one InformaMtiv9e) (-1)

Anonymous Coward | about 7 months ago | (#46502869)

In ratio of 5 to mechanics. So I'm from now on or A dead man walking. counterpart, But with Netcraft Software lawyers Yo0 can. When the conducted at MIT

Marisa Mayer lucked out (1)

symbolset (646467) | about 7 months ago | (#46503277)

Yahoo is getting more lift from this than her brilliance so far.

Alabama?! (1)

Noah SILVA (3457047) | about 7 months ago | (#46503979)

Yes, at first I read the headline to mean that Alabama would have an IPO!

kiss it goodbye (1)

slashmydots (2189826) | about 7 months ago | (#46505097)

In case you're not familiar, Allibaba is where they sell illegal ripoff counterfeits (that are marked as such), low quality electronics that break instantly, and where basically every seller is a scammer and doesn't speak english or have a customer support department. Yeah...that'll show Amazon what's what. This is going to make the impending Facebook and Apple stock crashes look small by comparison.
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