Table of Contents

S.No Topic Page Number
1. Introduction 3

2. History 4

3. Business Model 5

4. Products and Services 7

5. Target Users 8

6. Payment Methods 9

7. Comparison of Alibaba with other 12

9. References 15


which features thousands of nonbrand name products sold by smaller merchants; and Tmall. sell unwanted goods and make online payments. Alibaba has two retail sites: Taobao. Unlike Amazon. 3 . and host millions of merchants and businesses. which buys goods from suppliers and sells them to customers. Alibaba Alibaba is China’s and by some measures. This Chinese B2B trading platform connects buyers in North America and Europe with suppliers from China. Alibaba follows an aggregation of supply model (similar to other early B2B players).com — have hundreds of millions of users. eBay and Paypal. One can think of it as a mix of Amazon. connecting buyers and sellers and facilitating transactions between them. the world’s biggest online commerce company. Alibaba handles more business than any other e- commerce company. Its three main sites — Taobao. which offers brandname products sold by big Tmall and Alibaba. helping to solve the pain of global sourcing. Alibaba has always acted as a middleman. Customers use Alibaba to shop online.

S. a retail the company’s founders shared a belief that the Internet would level the playing field by enabling small enterprises to leverage innovation and technology to grow and compete more effectively in the domestic and global economies. From the outset. smart business person. it’s sister organization Taobao was founded as a consumer ecommerce platform. Alibaba is a kind. Which further established TMall (TMall. Alibaba Group raised a total of US$25 million from SoftBank. Fidelity and some other institutions. Goldman Sachs. During Late 90’s. After about a decade since its inception Alibaba group also betalaunched eTao as a shopping search engine. After Alibaba achieved profitability in 2001. a former English teacher from Hangzhou. . Alibaba opens sesame for small to mediumsized companies. China. making it the biggest U.8 billion in its debut. Jack Ma named his company on “Alibaba Open Sesame”. History Alibaba Group was established in 1999 by 18 people led by Jack Ma. to complement its C2C marketplace. and he helped the village.listed IPO in history after the IPO of credit card processing company Visa in 2008. Alibaba raised $21.

is Alibaba’s yet another handles sales between importers and exporters from more than 240 countries and regions. which offers a wide . C2C: Limited the primary company of Alibaba. From the very beginning Alibaba was . B2B: Taobao. is the world’s largest online businesstobusiness trading platform for small businesses. AliExpress. which has been able to successfully provide a hassle free platform to small to medium sized businesses to carry on over the offers a transactionbased retail is China's largest shopping website. Alibaba is probably the one organization in the world. In addition. it makes no sense. According to some ecommerce analysts.” In more technical terms three of the most prominent business models employed by Alibaba are: B2B. and tmall. which utilizes consumertoconsumer model similar to has three main services. but it had the goal of connecting all importers and exporters around the world to each other. Founded in Hangzhou in eastern China.”. which allows smaller buyers to buy small quantities of goods at wholesale prices. The Chinese portal 1688. Alibaba. Business Model The initial business model of Alibaba was simple ; a facilitate a 24/7 meeting platform for suppliers and buyers around the world. C2C and B2C. “the first global Internet emerging from china. The company’s English language portal was developed for domestic businesstobusiness trade in China. Although other B2B websites have always said “You cannot have a global company out of china . From the start Alibaba did not just connect Chinese suppliers with international buyers.

The two sites (Taobao.selection of branded goods to China's emerging middle class. more than Amazon and eBay's revenue combined. their combined transaction volume in 2012 topped one trillion yuan ($163 billion). Tmall marketplace is China’s largest businesstoconsumer (B2C) onlineshopping and Tmall) are hugely popular. The site allows visitors to quickly view vendor fees. According to The Wall Street Journal. required deposits and other factors associated with operating a Tmall storefront. . and collectively account for more than half of all parcel deliveries in China. B2C: In 2008. It features thousands of nonbrand name products sold by smaller merchants With around 760 million product listings as of March 2013. to compliment it’s C2C market. Taobao Marketplace is one of the world’s top 10 most visited websites according to Alexa. Although Tmall is mainly a businesstoconsumer platform is known for offering brand- name products. Alibaba Group also established another online website Tmall.

Hence. Alibaba is proving to be a onestop platform where a consumer can choose among a wide variety of options. . Rubber & Plastics ● Packaging. Components & Telecom ● Gift. Lights & Construction ● Jewelry. Sports & Toys ● Health & Beauty ● Home . Advertising & Office ● Online marketing ● Cloud Computing ● Logistics Operations ● Electronic Payment Services Alibaba is one of those online resources which claims a “Get everything and anything” availability. Bags & Shoes ● Machinery. Hardware & Tool ● Metallurgy. A consumer can literally buy products ranging to simple toys to automobiles. Products and Services Alibaba provides a wide variety of products and services through its various online portals. Textiles & Accessories ● Auto & Transportation ● Electronics ● Electrical Equipment . Some of these are: ● Apparel. Chemicals.

consisting its user base from about 190 odd countries. .K. where ecommerce is synonyms to Alibaba. But within last decade Alibaba has expanded to almost all the corners of the world.S. Japan and Korea.. who spend an average of 20 hours a week online. Alibaba has been turned into a global organization but still holding China as it’s major focus.S. U.. Apart from smalltomedium businesses Alibaba group also provides online platform to individual customers through its parent websites Tmall. Although to get a hold on other emerging markets Alibaba Group has also established offices in the Target Users Alibaba Group primarily operated within China. and Taobao. China has 560 million internet users twice as many as the U. Almost 75% of China’s ecommerce market is dominated by Alibaba.

Western Union For buyers: 0 Not recommended when it comes to paying out of 5 stars suppliers if the payment is not protected by . suppliers are not willing to accept this way due to big potential risk of dispute or fraud. This payment method For suppliers: 5 bears the same risk as Western Union and out of 5 stars is not recommended when dealing with an unknown supplier. DA/DP. 100% Upfront TT For buyers: 1 The supplier gets full payment before out of 5 stars production starts. 100% Backward TT For buyers: 4. But out of 5 stars complex procedures and high threshold of registered finance may prevent some SMEs from being involved. 4. Letter of Credit For buyers: 4 Highly recommended for transactions that out of 5 stars are US $20. 2. it is nearly 100% reliable for buyer cause buyer can cover the whole risk. it is suggested to use trade For suppliers: 2 terms of FOB. Letter of Credit. 3. 5. on the opposite. PayPal and Escrow. If being paid after receipt of out of 5 stars merchandise. Payment Methods Actually Alibaba Group has it’s own payment solution named as Alipay. 30% Upfront TT For buyers: 2. Western Union.5 If being paid after preshipment out of 5 stars inspections.5 Since many factories need money in out of 5 stars advance to buy material for production. Buyers are advised to consider each option carefully before committing to one. especially when dealing with an unknown buyer. Other than that. S.5 out of 5 stars term for suppliers. is a thirdparty online payment platform with no transaction fees. Six most commonly used ways are Telegraphic Transfer(TT)/Bank Transfer . For suppliers: 30% Upfront TT is a common payment 4.NO Methods Conditions Description 1.000 and above because the For suppliers: 4 bank guarantees the transaction. however. Alibaba also offers many ways to pay suppliers.

it is less popular with suppliers out of 5 stars due to difficulties in money withdrawal. will also employ highlevel encryption and verification to ensure only approved thirdparty applications. it's useful when transferring money to known individuals such as family members. Paypal For buyers: 5 A popular payment method for buyers as it out of 5 stars presents a much lower risk to them. such as Alipay Wallet. the world’s thirdlargest smartphone vendor by shipment volume .The Chinese ecommerce giant will get ahead of its competitors Amazon. It’s worth remembering that Alibaba is a pretty safe platform to purchase on. Not only do you have the standard protection that your payment provide gives. “The biometric technology. are allowed to access the fingerprint information for transactions.” the company says on its blog. For suppliers: 3 However. Escrow For buyers: 5 Money is only paid to the supplier after the out of 5 stars buyer confirms satisfactory delivery of For suppliers: 3 his/her order. However. In terms of innovation. will allow mobile users to confirm payments for a wide variety of goods and services with their smartphones simply by swiping a digit instead of entering a lengthy code. A safe way to buying and out of 5 stars selling online because Escrow protects both the buyer and supplier. 6. high tax rates and uncertain claim of charge back from some notorious importers 7. including encryption and authentication managed by Huawei. For suppliers: 5 escrow on a transaction made online out of 5 stars through AliExpress. Huawei. Google and Paypal with an innovative and secure method of payment using fingerprints instead of passwords. but Alibaba hold mostly all 10 . Alibaba is introducing a new secure mobile payment method as it gets ready for its IPO.

you might encounter legal hurdles should you decide to dispute the delivery. If the item is not what you ordered or if the item is defective due to handling. Alibaba also offers some tips for shipping methods: ● Using express companies such as FedEx or DHL You can open the shipment in front of the delivery person. If you only inspect the delivery after customs clearance. . Until the buyer confirms receipt the seller doesn’t receive the funds.payments in Escrow until the buyer confirms they’ve received the goods and they’re as expected. do not clear customs! You can always request for a customs officer or a thirdparty inspection company to conduct an onsite inspection before being issued a customs clearance certificate. you have the right to return it to the delivery person. ● Using sea freight shipping method If the item that you received is not what you ordered.

Fig : Revenues of various famous Techgiants . or the total value of available shares times the value of a single share . Take market capitalization. which also has a market cap in the $150billion range. And it’s growing. Wuaki in Spain and other major online providers with strong presence in their home and adjacent markets. and Microsoft ($378 Billion). That number makes it look pretty small compared to the top three US tech giants: Apple ($593 billion). Comparison of Alibaba with Other TechGiants Alibaba is really a technology company that serves retail customers and controls 80% of the Chinese ecommerce market.Alibaba will compete most directly with online retailers like Amazon. Alibaba’s market capitalization value is estimated at $155 billion. Kobo in India. EBay or Zalando in Europe. Google ($400 billion). Rakuten in Japan. But it compares nicely to Amazon.

“Gross Merchandise Volume (GMV). Alibaba now takes home 80 percent of its revenue as profit. is the total sum of goods and services transacted on all its sites.The comparison is not exactly applestoapples. the metric the company likes to highlight. That’s more than Amazon and eBay managed to do — combined. Alibaba doesn’t house and manage any products itself. in that it is a middleman coordinating sellers and buyers. Alibaba hosted GMV of $248 billion in transactions last year. And while Amazon takes home a lot more revenue than Alibaba from its fewer transactions. Alibaba takes a much higher net income from its revenue than Amazon. Alibaba’s business model is similar to that of Ebay. .” In 2013.

In comparison. but only half China’s total population. its 80 percent control of the market and 80 percent profit take from its revenue adds up to a huge.This shows how complicated it is to value Alibaba. China’s ecommerce market was $74 billion dollars. crazy. China has over 618 million internet users and they’re spending lots of money. To really understand how big a deal Alibaba is you’ve got to understand the growth of China’s e- commerce economy and the stronghold that Alibaba has on it. In 2013. That’s twice the population of the United States. growing amount of money. it’s estimated to reach $713 billion. By 2017.Alibaba’s revenue is the cut it takes out of each sale. So there’s lots of room for growth in a sector that’s already exploding. massive. And Alibaba is cashing in big time. Even though it’s not yet putting up the gross revenue numbers of Amazon and Apple. It controls 80 percent of online sales. In 2010. WalMart’s nearly $250 billion in revenue represents the total value of all the goods purchased along with its builtin margins. it was $295 billion. .

com/story/howtounderstandalibabasbusinessmodel20 14031594855847 ke- money rnetgiantwillsoongopublicworldsgreatestbazaar 8. http://www. . http://expandedramblings. http://www.php/alibabastatistics/ 4. https://www.html odelandthechinesemarketmakeitsipohot. References 10. 12. http://www. http://www. http://projects. / 9. rhere- arethreechartsyouneedtosee/ 13. 7. 3.techinasia. pple- itsalibaba http://www.