Instead of following the old business model, Alibaba’s new research and development team will shift into a “pure holistic R&D mechanism” by using cutting-edge technological solutions. (Photo : Getty Images)
There's a growing cynicism among residents of China's rural areas over Alibaba's plans in running its rural e-commerce villages, as it appears to be more as a way to promote city sellers to the countryside than connect rural sellers to city buyers.
The rural e-commerce villages, called the Rural Taobao centers, were launched in late 2014 as a five-year plan worth an investment of $1.6 billion to create 100,000 hubs for its e-commerce site. It was supposedly meant to connect around 600 million of China's poorest residents from rural areas to the cities.
But farmers who joined the Rural Taobao centers are complaining about meager incomes and the scaling back of commissions last year.
According to Yu Xueyi, a rabbit farmer in Anhui Province, said that he just quit the Rural Taobao service after realizing thal Alibaba is not serious about connecting rural sellers with the cities.
Yu said that his rural neighbors swiftly received their packages when ordering from cities but when it came to selling wealthy city buyers, Alibaba fell short in its efforts. He labeled advertisements of villagers earning stacks of cash by selling tea and oranges to the cities, in reality as publicity stunts concocted.
Yu made $4,350 last year as a top performer but his neighbors made less.
Alibaba noted that the program is a sign of its commitment to rural areas by pioneering a two-way distribution infrastructure between cities and rural areas in China. It also improves the quality of life of rural residents, while giving brands and manufacturers access to China's vast rural population.
The e-commerce company added that the program has provided a valuable service to rural areas and had helped 832 of China's most impoverished counties sell a combined 1.06 billion yuan of goods on the company's platform in the first half of 2016, up over 40 percent compared to a year ago.
Alibaba also noted that the sales market for rural areas could reach 1 trillion yuan ($140 billion) by 2020.
