Rakuten, President set up shopping JV

President Chain Store Corp., Taiwan's biggest convenience store operator, announced yesterday that it will form a NT$174 million (US$5.4 million) online retailing joint venture with Japan's Rakuten Ichiba (Rakuten Internet shopping mall).

President Chain, operator of 7-Eleven stores in Taiwan, will hold a 49 percent stake in the venture and Rakuten, one of Japan's top Web-based shopping mall operators, will take the rest.

Lin Chang-sheng, president of the Uni-President Group, the parent of President Chain Store Corp., signed the joint venture pact with his Japanese counterpart Hiroshi Mikitani in Taipei yesterday afternoon.

Lin said that the proposed joint online shopping mall will become officially operational in the second quarter of 2008, when individuals, shops and business conglomerates can all set up e-shops in the online shopping mall. "Consumers will also have more choices on the Web, expanding the overall scope of Taiwan's online shopping sector."

Lin continued that the proposed online shopping mall takes aim at a Taiwan online shopping market valued at around NT$180 billion. The mall is expected to turn profitable during the second operating year, and is estimated to have around 3,000 e-shops by its third year.

Hiroshi Mikitani said cooperating with Taiwan is his firm's first step towards internationalization, adding that Rakuten aims to become the world's No. 1 online shopping mall operator.

The online shopping mall marks the first venture of its kind for Rakuten outside its domestic market, and it is also President Chain's first online retailing joint venture with a major foreign partner.

Founded in 1997, Rakuten online shopping mall has witnessed over 20,000 e-shops, selling more than 20 million items including clothes, footwear, foodstuff, interior decoration and tourism, with annual trading value totaling over 500 billion Japanese yen.

In response to the cooperation project, Wu Wan-ju, public relations manager of Yahoo Kimo, said Taiwan's online shopping market is growing at an annual clip of over 50 percent, and the said project can help further expand the market pie.

Wu said that currently online shopping accounts for only 5 percent of Taiwan's consumer market, thus leaving great room for further growth.

Meanwhile, Lin Mu-ping, manager of the electronic business department of PChome, said the firm's online transaction business has entered its 10th year of operation, with an annual revenue now reaching NT$6 billion after experiencing an annual growth of 100 percent over the past years.

Lin welcomed the joint venture between President and Rakuten, saying that the project will prompt local operators of online shopping businesses to upgrade their services for customers.