Newegg.com.com, the operation of US retail giant Newegg.com in the Chinese mainland, saw a phase-II R&D workshop engineering project break ground on September 3.
The project, covering a land area of over 20,000 square meters and with an investment of about CNY 100 million as well as total building area of more than 60,000 square meters, is scheduled to kick off formal construction in November this year and run into operation in October next year.
Mike Chou, president of it, said in an interview that all of the capital was self-owned one and part of the project would be mainly used for the second R&D, assembly and sale of computers and related peripheral equipment with the brand of Rosewill or ABS, two self-owned brands of Newegg.com. The business was always completed in the US and Dongguan, Guangdong Province, in the past. And upon the completion, current business of Newegg.com.cn would be moved into the project. Actually, it had seen two of its business groups move into on May this year.
He reiterated that Newegg.com grew healthily around the globe currently and had huge capital at hand. Previous negative reports delivered little impact on overall performance of Newegg.com.cn, but some major clients of it were affected, more or less. And it would take it a period of time to communicate with them.
He added that environment of the domestic ecommerce market was still not healthy and this would cause B2C firms there to continue a loss-making operation over the following three to five years. Thus it would not seize market share through the mode. Newegg.com required it to own a stable growth. In addition, the loss should be reasonable, or the former would not continue investing in it.
Newegg.com was established in the US in 2001 and entered into the Chinese mainland soon. However, its market share in the Asian market continued falling in recent years and available data shows that, it seized only 0.3 percent share in the Chinese B2C market in the first quarter of this year. In the meantime, it provided delivery service in less cities there. People in the know disclosed not long ago that a logistics firm under the wing of it had quit Beijing, outsourcing related delivery service to a third-party firm thoroughly.
The president admitted that the logistics unit of Newegg.com.cn did have quit the capital due to unsatisfactory market size there. However, it thought highly of the Chinese market and would continue investments in other Chinese cities in the future.
