When Warren Buffett spends $12bn on Heinz, a $125m stake by Prince Alwaleed bin Talal in Chinese online retailer 360 Buy looks trivial. But it is a sign that while the most famous value investor is plumping for quality, if not value exactly, his rival is still backing shoot-for-the-stars propositions. And they don’t get much starrier, or riskier, than China’s cut-throat retail world.
Based on sheer size, ecommerce in the world’s second-largest economy has enormous potential. Only about two-fifths of China’s population is online, half the proportion of the US or South Korea. At 200m, there are already 25 per cent more online shoppers in China than the US, yet this still only constitutes a third of all Chinese netizens. Three quarters of web-savvy Americans are regular online spenders. China has far fewer retailers who can call themselves national too, so the web offers huge brand value potential to the outfit that can make it big online.
The trick is profiting from this market. Prince Alwaleed’s target, 360 Buy, is the second-largest online retailer, accounting for about a sixth of transaction value. Its sales have been rising at a compound 150 per cent. But so has the online market overall, according to Macquarie, suggesting little share gain in spite of extreme, and expensive, price war stunts that have hurt everyone. Gome, which competes in electronics, recently said its online unit was one factor in its first full-year loss last year. Macquarie expects market growth to slow to about 50 per cent by 2015. Most businesses would die for that, but there are as yet no signs of profits at 360 Buy as it builds a delivery network.
Prince Alwaleed’s stake is part of a $400m injection for 360 Buy. Forget that last year the company said it was fully funded until 2015. Kingdom Holdings, the prince’s vehicle, says it invests in groups that seek to list in three years. That could be optimistic.
1.Word of the day
stunt：anything spectacular or unusual done to gain publicity 噱头，花招
ex: Climbing up the church tower is a fine publicity stunt.
2.Phrase of the day
to die for： (informal) if something is to die for, it is extremely good 渴望
ex: The weather's fantastic, the people are warm and friendly and the food is to die for.
3.Sentence of the day
Prince Alwaleed’s stake is part of a $400m injection for 360 Buy.
小编注：这句话中injection的用法值得学习和借鉴。以往我们熟知的injection是注射的意思，比如I'm going to give you a pain-killing injection. 而在商务语境下，injection更多地表示资金和人才的注入。比如，
ex1: This liquidity injection was designed to ensure that money markets continued to function and did not succumb to a credit freeze.
ex2: With management insight from Ceibs and the injection of new personnel talent, the company started to move out of the red.
4.Cultural point of the day
shoot for the stars：means to aim high, set a big target, have big goals, dream big dreams.抱负远大、一鸣惊人
ex: When it comes to pursuing professional goals, Miss Brown likes to shoot for the stars, which is why she became an intern at the White House.
小编注：美剧《老友记》中有这样一句话“There are people, like Ross, who need to shoot for the stars.”这里shoot for the stars的意思就是一鸣惊人。这是一种形象的用法，stars必须是复数。同样的用法还有shoot for the moon。
5.Translation of the day
When Warren Buffett spends $12bn on Heinz, a $125m stake by Prince Alwaleed bin Talal in Chinese online retailer 360 Buy looks trivial.
相比沃伦·巴菲特投资亨氏(Heinz)的120亿美元，阿尔瓦利德·本·塔拉尔王子(Prince Alwaleed Bin Talal)投资中国网络零售商京东商城(360 Buy)所花的1.25亿美元看起来微不足道。