The Beijing Municipal Business Commission has issued a circular which encourages retailers to set up online stores.

According to "Opinions on Promoting the Development of Online Retailing Industry" issued by BMBC, units like department stores, boutique stores, wholesale markets and supermarkets that have already had computerized management in place shall try online retailing by setting up Internet stores and increase their goods categories. Mature online retailing service providers are encouraged to provide online services for small and medium-sized trade companies.

The Opinions state that online promotions will be regulated to protect the interests of Chinese consumers. In addition, the government will offer technology support and training to SMEs regarding the application of e-commerce, enhancing their capability in using modern circulation tools for market expansion and operation. The Opinions state that SMEs shall use e-commerce to improve their operational efficiency, and support will be given to time-honored brands, renewable resources and franchises located in rural and suburban communities.

The Opinions suggest that logistics and payment problems be settled via a third party for online retailing businesses.

So far, Chinese retailers like Wu Mart, Jingkelong, Gome and Suning have each launched their online stores, but due to the many limits they pose on consumers such as a minimum consumption of CNY200 for goods delivery, these online stores have received few customers. China's online transaction volume reached about CNY130 billion in 2008, which was an increase of 130% over that of the previous year, and Alibaba's was the largest comprehensive online retailer by accounting for 1% of the country's total social retailing service.


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