Tencent Adjusts E-commerce Subsidiary Structure In China

According to an internal email reportedly sent by Bu Guangqi, chief executive officer of Tencent’s e-commerce subsidiary 51buy.com, the company will implement a structural adjustment, aiming at sales of CNY15 billion to CNY20 billion in 2013.

With this move, the company will establish a new e-commerce operating unit, a logistics unit, an enterprise development unit, and a new area management committee. 51buy.com’s new e-commerce operating unit will focus on procurement, sales, and operations as well as the establishment of the company’s reputation. This unit will have four business sectors, including 3C products, mobile communications, home appliances, and daily commodities.

The newly established logistics unit will be based in Shanghai and focused on building the largest automated warehouse distribution center in Asia. It will have over ten warehouse distribution bases in cities like Chengdu, Jinan, Fuzhou, and Changchun.

The enterprise development unit will be responsible for new business development and pre-research work, integrating the former cloud distribution business unit and branded business unit of the company. At the same time, this new unit will continue to work with top brands in China and abroad.

The new area management committee will establish a more flexible decision-making system for non-mature regional markets. The committee will be formed by senior executives of the company, which helps better support the national strategy of the company. The developing non-mature regions will directly report to the committee.

In addition, 51buy.com will maintain the IT information center, HR and management platform, and financial management platform.

Bu said over the past three years, 51buy.com’s sales increased by nearly 20 times. Starting from 2012, the competition in the industry entered a new heated phase and the structure of the entire industry will be shaped in the next two to three years.