Yi Hua Department Store Holdings has entered into a strategic purchasing pact with China Merchants Food to jointly develop cross-border eCommerce and bonded merchandise business.
Yi Hua operates a group of retail businesses in Mainland China, including supermarkets, department stores, electrical appliance retailers and furniture stores, and provides consulting and planning services. Since August this year, the company has started importing merchandise and developed a cross-border eCommerce business.
Integrating with its bricks and-mortar imported merchandise direct sales stores, this online-to-offline (O2O) business model uses its fully-fledged sales channels and comprehensive online network for the sale of imported goods, the company says.
Under this week’s pact, Yi Hua will entrust the purchase of imported merchandise to Hong Kong-based China Merchants Food, which will provide logistics, storage, and distribution as well as customs clearance and inspection services.
Most of the cooperation will centre around two imported merchandise direct sales stores opened in Zhongshan City and Jiangmen City since August. The Yi Hua board believes combining its retail and distribution network with the overseas purchasing network and superior financial strength of China Merchants Food, will lower purchasing costs, ultimately resulting in a win-win situation for both companies.
Furthermore, Yi Hua will be able to widen its merchandise purchasing channels.
“These will build a firm foundation for the group to quickly develop cross-border eCommerce and imported merchandise direct sales experience stores in the next step,” the company said in a statement.