As we can see in Fig.1, the transaction scale of Chinese
e-commerce has grown steadily from 2004 to 2009, 57.1% of
which in terms of quantity is mainly engaged by apparel
consumption(refer to Table II), indicating that the apparel
industry in China provides an enormous space for
e-commerce. On the basis of the figures gained in the
previous years, IResearch estimates the prosperous future
trend of Chinese apparel e-commerce transaction scale.
One difference between offline and online shopping is that
physical supermarket in the neighborhood without price
advantages or product differentiation can still survive by its
convenience. However, online retailers are easily neglected if
product distinction or further values are not provided.
Moreover, purchasing online involves less opportunity costs
relative to offline shopping because price comparison
between several online malls can be realized within a second.
This aggravates the price competition and lead to squeezed
profits in the market.
For existing bricks-and-mortar retail companies, online
sales are creating new avenues to new consumers in regions
of China where they have not yet managed to cover. Without
the need to invest in the building physical store chains or
management of franchisees, online retailers financially bear
less. What does lag, and stalls the more rapid growth of
retailer penetration across more of the country via the
Internet, is the lack of product delivery infrastructure and
on-going weaknesses in the transaction clearing
infrastructure.
For emerging online-only retailers, there is the prospect of
creating the kind of strong competition with the traditional
retailers that can act as a strong lever for increasing capital
investment, or negotiating into partnerships with the
traditional retailers, where established online retail expertise
and technologies are hugely valuable.