Ochama, a retail concept brand that is part of the Chinese e-commerce giant JD.com, has announced the expansion of its home delivery services to another 19 European countries. This brings the total of Ochama European regions to 24 countries on the continent.
The decision to expand Ochama into Europe came as a consequence of the Covid crisis and its deep impact in Asia.
In 2023, JD.coml ended its Ochama services in Thailand and in Indonesia due to post-COVID-related issues. The company did not explain in detail the reasons behind the closures.
But it was clear that JD decided to bet on Europe, as Ochama, its new retail model, officially launched in January 2022 in Spain, the Netherlands, Belgium, Germany, France, Italy, Hungary, the Czech Republic, and Luxembourg.
The Ochama model includes assortments of food, hygiene, cleaning, fashion, and consumer electronics, among other categories, and combines online shopping with in-store pickup, fully automated and robotized to allow customers to pick up their items on the spot. In addition, it also offers the option of home delivery.
Currently, things are not looking great for JD. Shares of Chinese e-commerce giant JD.com fell 13% to an all-time low on Friday after several banks and brokerages cut the company's price targets and revenue growth forecasts, hinting at a weaker-than-expected recovery in consumer spending.
A debt crisis in the critical real estate sector has contributed to slowing China's post-pandemic economic growth, and many Chinese have cut back on spending due to concerns about the economy and job security, hurting the retail sector.
In March, JD.com already warned that it would take time to regain consumer confidence after the pandemic, missing its revenue forecast for the fourth quarter.
Citi Research lowered its revenue forecasts for JD.com by 3.4% and 4.3% for the third and fourth quarters and now forecasts growth of 0.8% and 1.3%, respectively.
The bank's analysts cite a "relatively muted consumer trend, a high base, intense competition, and the ongoing impact of the restructuring adjustment" to justify the change in forecasts.
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