China’s second largest e-commerce company JD.com quietly closed down its office in Melbourne after a little over a year of operation, putting the company’s CEO Liu Qiangdong‘s ambitious expansion plans into the southern hemisphere on hold.
According to Chinese business media Huxiu, JD.com said offices were set up in Australia to bring more Australian brands to the online platform. After years of efforts most of the Australia’s premium brands have opened their business on JD.com and the local offices have completed their mission.
The regional head Patrick Nestel has confirmed his departure, and the Australian business will be integrated into the Chinese business where Australian exporters will be connected to and managed by the domestic team.
In February last year, the online retail giant announced to march into the Australia and New Zealand markets by providing retail services to local users through an exclusive partnership with Tencent. Backed by the Australian government, JD.com opened its Oceania headquarters on the Collins Street in the center of Melbourne.
Liu Qiangdong said last year the company’s entry into the Oceania markets was an important step to meet the large demand for quality products in the region. Local retailers expressed their concern about the impact of the arrival of the Chinese online seller, but so far international retailers such as Alibaba, JD.com and Amazon have not had a major impact on the market.
This is a challenging time for e-commerce as the overall growth in the industry is slowing down and the giants are under pressure for making profits.