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An employee bags a customer’s purchases at a Kroger store in Peoria, Illinois.
Kroger will begin to sell its products on Chinese e-commerce site Alibaba, the latest in a series of initiatives to bolster its digital business.
The Cincinnati-based grocer has over the past few months moved to transform its business as it readies its defenses against giants Walmart and Amazon. It acquired a stake in British online supermarket Ocado in May, agreed to buy meal kit company Home Chef and launched grocery delivery service Kroger Ship.
Kroger plans to open an online storefront on Alibaba’s platform for international brands, Tmall Global. Its focus will include dietary supplements and private label products under the brand Simple Truth.
There has been a growing interest in China for overseas nutrient products, fueled by the country’s increased focus on health and wellness and amid limited confidence in its own safety standards.
Kroger’s Simple Truth line, launched in 2012, has since grown to reach $2 billion in sales.
An Alibaba spokesperson told CNBC the company is “pleased to work with Kroger to bring their Kroger Simple Truth products to the Chinese market through our Tmall Global platform to meet Chinese consumers’ growing demand for high-quality, organic food products.”
The Kroger/Alibaba partnership is the latest effort of a U.S. retailer to rethink its global footprint. In May, Walmart agreed to a $16 billion deal to acquire a majority stake in India’s Flipkart, beating out Amazon in the process. A month later, it announced the sale of its Brazil unit to private equity firm Advent International.
Shares of Kroger were up more than 2 percent in early afternoon trading.
Kroger did not immediately respond to requests for comment.
source : CNBC