What is the state of AliExpress business in Russia?

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According to the financial statements, the revenue of Alibaba.com (RU) in 2023 decreased by 36% compared to the previous year and amounted to 10.5 billion rubles. The press service of AliExpress CIS explained the decrease by a reduction in local business and the share of the marketplace's own sales. The company indicated that its business is now focused on supporting cross-border trade, developing logistics and reducing the delivery times of orders for buyers.

The revenue of Aer-Technological mexico whatsapp resource Solutions decreased by 8.5%, to RUB 3.2 billion, while that of Aggregator-s Online decreased by 12.5%, to RUB 1.4 billion. The Aer-Technological Solutions report notes that in 2023, Aliexpress CIS Holding Pte. Ltd forgave it a debt of RUB 1.22 billion, and that of Aggregator-s Online a debt of RUB 1.27 billion.

Tatyana Otradnova notes that the introduction of anti-Russian sanctions continues to affect the work of the marketplace. "Even if the marketplace is ready to deliver from China to Russia, the seller is not always ready to accept payment from Russian banks. Very few Russian consumers have foreign bank cards," she emphasized. Otradnova named the declining attractiveness of the site for Russian buyers as another factor in the reduction in revenue: "Despite the fact that the AliExpress website has a wider range of products and lower prices, Russian buyers face payment problems and switch to local marketplaces. The latter, although they sell the same goods at a higher price, win over their competitors due to the possibility of fast delivery."

According to the results of the first half of 2023, AliExpress Russia became the only marketplace on the Russian market where the number of sellers decreased, Kommersant wrote, citing data from Tochka Marketplaces. According to the service's calculations, the number of sellers on the platform decreased by 27% year-on-year.

Alibaba.com (RU) also reports that in 2023, the number of its employees decreased from 400 to 208 people. The press service claims that at the beginning of 2023, the company employed 248 people, and at the end of the year - 212. "For large companies, this is an average turnover rate, which is the result of optimizing business processes and outsourcing some functions," said a representative of AliExpress CIS. He also noted that the data of one of the legal entities does not reflect the full number of employees of the company. According to the reports, the number of employees in Aggregator-s Online decreased by 105 people, to 30, and in Aer-Technological Solutions - by 24, to 541.

The main reasons for the layoffs include a decline in retail and wholesale sales, the abandonment of a significant portion of warehouse space, and the automation of internal processes, Otradnova believes. "Judging by the profile of open vacancies, the company is recruiting mainly IT specialists. It can be assumed that AliExpress is increasingly becoming an IT company accompanying the online platform, rather than a trading platform in the traditional sense," she believes.