SAO PAULO, Brazil — Alibaba Group Holding Ltd., China’s largest e-commerce company, is emerging in Brazil as a challenger to entrenched foreign rivals EBay Inc. and Amazon.com Inc. as consumers seek cheap imports.
AliExpress, the Hangzhou, China-based company’s retail marketplace that allows consumers to buy directly from Chinese wholesalers and manufacturers, started operating in Brazil last year, according to E-Bit, a Brazilian firm that researches online consumer behavior. It’s already the third-most-used website -- with a 20 percent market share -- after EBay and Amazon for buying goods from abroad, according to E-Bit.
Brazilians are increasingly likely to shop in China because the prices are unbeatable, even as import taxes can double the cost and shipping takes a month or more. The deals are worthwhile for many consumers as the economy is in recession and inflation is exceeding the official target.
“There is concern over the high volume of sales on international sites, especially Chinese ones that offer very, very, very competitive prices,” said Pedro Guasti, president of e-Bit, in an interview. “For some products, it’s five, 10 times cheaper than the national equivalent.”
Consumers are expected to spend 5 billion reais ($2.2 billion) this year on imported goods from vacuum cleaners to hockey sticks, compared with 35 billion reais on items bought from Brazilian shopping sites, which ship from within the country, according to e-Bit. The top e-commerce retailers in Brazil are B2W Cia. Digital, Cia. Brasileira de Distribuicao and Walmart.com.
Revenue from Alibaba’s international retail business rose 139 percent compared with a year earlier to $151 million in the 2014 fiscal year, according to its IPO prospectus. The increase came mainly from AliExpress sales in Brazil, Russia and the U.S. Alibaba generates 86 percent of its revenue in China and uses AliExpress for global expansion.
AliExpress operates Portuguese and Russian language websites. Brazilians can also use the local “boleto” system to pay for goods bought on AliExpress instead of using credit cards, which are not widely used.
By Christiana Sciaudone; editors: Ed Dufner, Molly Schuetz, John Lear.