Foxconn starts selling used Apple gadgets such as iPhones and iPads. (Photo : Reuters)
A new e-commerce platform, from Taiwan-based Foxconn, remains in the trial phase, while a company that is more widely known for its electronics manufacturing prepares to reach its ambitious goal of becoming China's second-largest online shopping service.
Like the e-commerce operation that it used to manage on Alibaba Group Holding's online marketplace, Foxconn's new platform will sell electronics products, after the company's attempt at brick-and-mortar stores was shut down in 2013 due to a failed run in the Chinese marketplace.
Known officially as Hon Hai Precision Industry Co., Foxconn has previously found bottom-line success through a manufacturing partnership with technology leader Apple Inc.
Responsible for assembling the majority of Apple's iPhones and iPads, Foxconn is now looking for new channels to further expand its business model, as its revenue from the contract manufacturing business has been progressively slowing down.
Furthermore, the manufacturer contends with fierce competitors that are eager for Tim Cook's attention, while increasing wages in China mean that Foxconn's revenue performance has not been as impressive in the last few years.
Foxconn chairman Terry Gou has not been shy about his ambitious hopes for the new e-commerce venture. Gou wants to displace China's second-largest e-commerce site, JD.com, in three years, and this has led to the formation of skeptical onlookers.
Both Alibaba and JD.com control over 70 percent of China's e-commerce market, which is reinforced by the online payment entities under the wings of both companies. The former uses its Alipay payment system for most transactions. while JD.com is backed by Tencent Holdings Ltd., which also runs its own system.
Not only does Foxconn lack its own online payment system, but it will also need to build its retail reputation, develop relations with suppliers, and work out how to make sure its customers receive their goods in a timely manner.
