6:57 am - Sunday October 26, 2014

Chinese online shopping mall to be shut down by Rakuten

The top online retailer of Japan Rakuten, on April 20, 2012 said that it was concluding a hopping venture with Baidu, a Chinese Internet giant. While talking about the reason the retailer said that the intensified competition in the growing 3-commerce sector was the reason.

The firms in the year 2010 started a virtual shopping centre called the Lekutian for the Chinese market. But since its inception it had struggled and will now be shut down by the end of May.

China has the largest online population with about more than half a billion users. Rakuten in a statement said, “In the face of intensified competition in the Chinese e-commerce industry, Lekutian did not perform in line with our expectations”.

The statement added that after careful discussion both the companies came to a mutual decision that the closing Lekutian would be the best in the interest of all the stake holders. When the Lekuten project was announced ,the company had then planned that they would invest $50 million in the upcoming three years. It was also a plan of Rakuten to expand its global operations. The Japanese firm on April 20 said that the movie could have a little impact on its earnings.

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