Kaola, a cross-border ecommerce firm acquired by Alibaba, has reduced its headcount from around 400 last year to less than 20 in July, LatePost reported. The platform is now focused on selling beauty products as well as mother and babycare items.
The development comes after a rumor circulated among Kaola employees earlier this year, which stated that the firm must break even or risk shutting down in September.
Last year, the firm amassed a gross merchandise value (GMV) of less than 3 billion yuan (US$440.7 million), falling far below similar companies such as Tmall Global – which reached 60 billion yuan (US$8.8 billion) within the same period.
In 2019, Alibaba acquired Kaola from Chinese internet company NetEase for US$2 billion. Kaola had been the market leader among cross-border ecommerce firms for four years prior, with a market share of 27.7% in the first half of 2019 and a GMV of 30 billion yuan (US$4.4 billion) in 2018. The transaction was reportedly carried out to ensure Alibaba’s competitors could not acquire the company.
See also: Alibaba’s financial health in 5 charts
Currency converted from Chinese yuan to US dollars: US$1 = 6.81 yuan
Editing by Miguel Cordon and Lorenzo Kyle Subido
(And yes, we’re serious about ethics and transparency. More information here.)
Stay updated on the go with our mobile app.
Get latest insights with smoother, more personalized experience through TIA mobile app.
