Alibaba.com Faces Test For Continuing Growth
When Li Bo began producing memento buttons in 1998, he reckoned his three-man operation would sell its goods mostly to tourist-site operators and other buyers in his hometown of Shenyang, a city in northeastern China.
Then he registered his company with Alibaba.com, a Chinese Internet company that specializes in introducing manufacturers and buyers across China and around the world. A Chinese trading company more than 2,000 kilometers away saw Mr. Li's listing and ordered 200,000 political-campaign buttons for a buyer in France. Last year, Mr. Li's company generated nearly seven million yuan ($845,700) in revenue, and got half of its orders from people -- most of them far from Shenyang -- who learned about the company through Alibaba.com. "We would never have done so well if it weren't for Alibaba," Mr. Li says.
While helping small Chinese companies grow, Alibaba.com has grown quickly too. Industry analysts say the company, set up by former English teacher Jack Ma in 1999, has become China's biggest e-commerce operation and ranks first among Asian business-to-business Web sites in terms of traffic. But to reach Mr. Ma's goal of becoming a global player, Alibaba.com will have to make the transition from serving as an online global trade fair to a for-pay, online transactions service -- a critical test that faces the company over the next few years.
"That's always been the holy grail for B2B," says Duncan Clark, chairman of BDA China Ltd., a technology-research company, referring to companies that facilitate online business deals. "If Alibaba wants to live up to Jack's promise of becoming a major force in global business, it will need to be taking a fee on the deals it is facilitating."
Alibaba.com, based in the city of Hangzhou in eastern China, took the first step toward this goal Tuesday, when the company said it had raised $82 million from four institutional investors. Mr. Ma said the funds will go toward developing technology, training personnel and building customers to move the company's business-to-business Web sites from a "meet at Alibaba" model to a "work at Alibaba" model. "China's future is e-commerce," Mr. Ma says. "We need to make huge investments in the next three to four years to enhance our position here."
(Three of the institutional investors are companies that have invested in Alibaba.com for four years: Softbank Corp. of Japan; Fidelity Investments' venture arm; and Ventures TDF Technology Group of China. The fourth, Granite Global Ventures of the U.S., is a new investor. Alibaba.com declined to disclose the share holdings of each company after the equity placement, but said Softbank remains the largest institutional investor. Alibaba.com's management and employees remain the company's major shareholders.)
E-commerce is booming in China. Fu Xiaohui, a researcher who works for a consulting company under the Ministry of Information Industry, estimates that the value of business-to-business deals hit 275.6 billion yuan in 2003, while business-to-consumer deals were valued at 5.2 billion yuan. He didn't provide comparative figures, but the official Xinhua news agency said the total amount of B2B business in 2000 was 76.77 billion yuan, and B2C business was 390 million yuan.
Alibaba.com seems to be off to a strong start. Mr. Ma says the company has nearly three million users in 200 countries and attracts nearly 6,000 new users daily. It already has found a way to generate profits from its three Web sites, with $12 million in free cash flow last year, the company says. Its sites include two business-oriented ones: an English-language site matching Chinese and international businesses; and a Chinese-language one targeting companies in China. A third Chinese-language site links Chinese consumers with other consumers and businesses, much like U.S.-based eBay.
While anyone can access the two business sites, users who pay a membership fee are entitled to post detailed information about themselves, and can access additional information and services. Alibaba.com charges an annual fee of between $5,000 and $8,000 for Chinese suppliers who post detailed content about themselves on the company's international business-to-business Web site, for example. More than 4,000 Chinese suppliers have signed up for the for-pay international service, with a 70% renewal rate, Mr. Ma says.
For its domestic business-to-business Web site, suppliers who pay a $300 annual membership fee are entitled to additional services, after they have met background and credit checks by Alibaba.com. Mr. Ma says that Alibaba.com had 30,000 paid subscribers for the domestic service in 2003 and that the company receives more than 3,000 inquiries daily about the service.
A key goal of these services, Mr. Ma says, is to help small and medium-size companies earn money by linking them directly to buyers and markets to which they otherwise wouldn't have access. Another is to help them assess the credit-worthiness of potential business partners. As China's market economy takes off but before the establishment of any national credit-rating systems, the ability to accurately assess potential partners' credit-worthiness is critical to running a successful business, whether it be a national commercial bank or a corner store.
Such services attracted Lu Dengai, president of a family-run ant farm in the southwestern province of Guangxi, to sign up as an Alibaba.com member two months ago. She estimates that the number of buyers of her farm's ant nests and eggs jumped one-third to about 80 a month after she registered at her son's recommendation. In addition to gaining more customers, "you don't have to worry about credit risks on Alibaba, because they check the registered companies carefully and will publicize the names and phone numbers of cheating ones," Ms. Lu says.
It remains to be seen whether Alibaba.com can translate its initial success into a profitable online transactions business, a scenario that is three to five years away, according to Mr. Ma. Joe Tsai, Alibaba.com's chief financial officer, says the road will be hard. "Buyers are very reluctant to commit to deals online, because it takes time and due diligence, and the amount of money is large," he says.
In addition, many current users are attracted to the site just because it cuts out payments to middlemen, "so if we start acting like a trading company, where we take a cut of every deal, I think a lot of people won't come back." Ultimately, Mr. Tsai says, the market will have to mature.
Mr. Li, the Shenyang buttons maker, isn't put off by the thought of paying a fee. "I often pay out money now to buy raw materials online," he says.
Ms. Lu is more cautious. "There are too many cheats now," she says. But she adds that if Alibaba.com were to play a major role in online transactions, such as receiving money from her clients first and transferring it to her, "I'd be more likely to accept it."
阿里巴巴面临转型考验
李波1998年刚开始生产纪念品像章时，他这个只有三个人的公司的客户基本都是旅游景点的商人以及他沈阳老家的一些买主。
此后他在阿里巴巴网站(Alibaba.com)上注册加入了他的公司。这家中国互联网公司专门致力于为中国和全世界的制造商和买家搭建业务桥梁。远在2,000公里之外的一家中国贸易公司在网上看到了李波列出的产品名录，于是就为法国的一位买主订购了20万个政治宣传像章。去年，李波的公司收入将近人民币700万元（845,700美元），其半数以上的订单来自那些从Alibaba.com上得知其信息的客户，这些人大多数人都远在沈阳以外。李波说，"要是没有阿里巴巴，我们永远都不会做到这么好。"
在帮助中国小企业业务增长的同时，Alibaba.com也在迅速成长。行业分析师称这家由从前是英语教师的马云1999年创建的公司现已成为中国最大的电子商务公司，按网站浏览量计算，它稳居亚洲企业对企业(B-B)网站的头把交椅。但要实现马云将其发展为全球性B-B网站的雄心，Alibaba.com将必须从一个全球网上贸易市场转变为一个网上付费的交易服务平台－－这将是公司未来几年面临的重要考验。
科技研究公司BDA China Ltd.董事长邓肯?克拉克(Duncan Clark)在谈到那些撮合在线交易的公司时说，"那永远都是B2B的圣杯。如果阿里巴巴要达到成为全球贸易的一股主要力量的壮志雄心，它就必须对它撮合的交易收取费用。"
总部在中国杭州的Alibaba.com周二向这一目标迈出了第一步，公司宣布从四家机构投资者融资到了8,200万美元。马云说，这笔资金将用来发展技术、培训员工以及建立客户基础，将公司的B-B网站从"相约在阿里巴巴"模式转变为"工作在阿里巴巴"。
马云说，"中国的未来就是电子商务，我们需要在未来三到四年中做出巨大投资以提升我们的市场地位。"（三家投资者在过去4年间一直是阿里巴巴的投资人。它们分别是日本的软库(Softbank Corp.)、富达投资(Fidelity Investment)旗下投资子公司和中国的Ventures TDF Technology Group。美国的Granite Global Ventures则是后来者。Alibaba.com拒绝透露配股后各个公司的持股比例，但表示软库依然是它最大的机构投资者。Alibaba.com的管理层和员工依然是公司主要股东。）
电子商务正在中国蓬勃发展。据中国信息产业部(Ministry of Information Industry)名下一家咨询公司的研究员傅晓辉估计，B-B交易2003年达到了人民币2,756亿元，企业对客户(B-C)交易额为人民币52亿元。他没有提供比较数据，但据官方的新华社报导，2000年B2B交易总额为人民币767.7亿元，B2C为人民币3.9亿元。
Alibaba.com似乎来势凶猛。马云说，该公司有将近300万用户，遍布于200多个国家，而且每天新增大约6,000名用户。公司称，它已经找到了从旗下三个网站盈利的途径，去年的自由现金流有1,200万美元。它旗下的网站包括两个针对公司的：一个是联系中国和国际公司的英文网站；另一个是针对中国国内公司的中文网站；第三个是类似美国eBay的联系中国消费者和其他消费者及公司的中文网站。
虽然任何人都可以访问两个商务网站，但只有支付会员费的用户获准在上面发布自己的具体信息，而且可以获取其他更多的信息和服务。 Alibaba.com对那些在其国际B-B网站上公布其详细信息的中国供应商收取5,000美元到8,000美元的年费。马云说，有4,000多个中国供应商注册了付费国际服务，续注率有70%。
阿里巴巴的国内B-B网站向供应商收取300美元的年费，他们在达到Alibaba.com的用户背景和信用核实标准后将能享用到更多服务。
马云说，2003年Alibaba.com的国内服务有3万付费用户，公司每天会收到3,000多份有关该服务的咨询。
马云说，这些服务的主要目标是帮助中小企业直接联系他们无法从其他途径接触到的买方和市场，并从中盈利。另一个目标是帮助他们了解潜在商业合作伙伴的信誉。由于中国的市场经济建设先于全国信用评估体系的成立，能否了解到潜在合作伙伴的信誉度对于企业的成功经营来说就显得十分关键，不管你经营的是一家全国性商业银行也好，或者是一家街头小店。 陆登爱是中国广西一家蚂蚁养殖家族企业的总裁，阿里巴巴的上述服务两个月前吸引他注册成为了Alibaba.com的会员。她说，在她儿子的建议下注册成为阿里巴巴会员后，养殖场的蚁巢和蚁卵买家数量一下子增加了三分之一，每月有将近80位客户。陆登蔼说，除了获得了更多客户以外，"你在阿里巴巴还不必担心信用风险，因为他们已对注册公司进行了仔细核查，并将公布那些有欺骗行为公司的名称和电话。"
马云说，现在的问题是Alibaba.com是否能从最初的成功发展为一个盈利的网上交易公司，实现这一远景还需要三到五年时间。Alibaba.com的首席财务长Joe Tsai说，这条道路是艰难的。他说，"买方不太愿意在网上直接达成交易，因为需要时间和精力，而且金额巨大。"
Tsai还表示，很多现有用户之所以被吸引到该网站上来是因为这样就省了支付给中间代理商的费用，"因此如果我们开始像一家贸易公司那样展开业务，从每笔交易中收取报酬，我想很多人都不会再来了。"Tsai说，市场最终必将会成熟起来的。
沈阳的像章制造商李波对付费毫不排斥。他说，"我现在经常付款在网上购买原材料。"陆登爱则更加谨慎，她说，"现在欺诈行为太多了。"不过她又表示，如果Alibaba.com要在网上交易中承担重要角色，如先从她的客户那收取款项然后再转帐给她，"我很可能接受这种方式。"
