Amid a slide that has seen its shares lose 40% of their value since November, Shopify is partnering with a Chinese e-commerce powerhouse in a bid to make it easier for its US-based merchants to sell their products in the most populated market in the world. .
The Ottawa-based software giant announced this week that it has reached an agreement with JD.com that will allow merchants in the United States who operate online stores using Shopify software to list their wares on the global commerce platform. electronics from JD, known as JD Worldwide.
Shopify said the new sales channel, launched on Tuesday, opens the door to 550 million customers in China, where JD.com is jostling with Alibaba for the title of the country’s largest online retailer.
The new platform will automatically translate product names and descriptions, convert prices to local currencies, and calculate all shipping and customs charges. Shopify said it was working with JD.com to create a seamless process for moving goods from the Chinese company’s US warehouses to customers in China.
Shopify Vice President Aaron Brown called the collaboration between the two e-commerce giants “a major step in solving cross-border commerce for merchants.”
Daniel Tan, president of JD Worldwide, said the alliance will “unleash the enormous potential of the Chinese market” for brands outside of China.
“At the same time, it will increase cross-border trade by leveraging our global supply chain capabilities, simplifying what has always been a very complicated process,” he said in a statement.
Shopify said the new sales channel is part of a “broader strategic partnership” between the two companies that “aims to help solve the challenges of cross-border commerce across product sourcing, selling and logistics for merchants in the United States and China”.
The partnership with JD.com comes as Shopify shares have been mired in a free fall that knocked the software giant from the No. 1 spot on the list of Canada’s most valuable publicly traded companies.
The stock has been steadily falling since mid-November after Shopify’s chief financial officer warned that the “extreme levels” of online spending seen earlier in the pandemic would likely level off as more consumers return to in-person purchases and that COVID restrictions would be relaxed.
After hitting a high of $2,228.73 on the Toronto Stock Exchange in late November, Shopify shares were trading at just over $1,330 as of midday Thursday.
Kevin Headland, co-head of investment strategies at Manulife Investment Management, told The Canadian Press last week that the prospect of impending interest rate hikes was having a negative impact on tech stocks which have thrived in rising rates. low, and Shopify is no exception.
“If I look at the TSX, what’s driving this drop down is really Shopify, and I think it’s just being dragged down with its peers in the US,” Headland said.