Chinese company founded in June 1999 by Chung
Tsai and Yun Jack Ma with headquarters in
Alibaba engages in online mobile commerce and
offers services, products, and technology that helps
transform the way brands, merchants and other
businesses market and operate in China and
The company’s revenue has been on a steady
$8.576 million in 2014
$15.903 million in 2016$15.903 million in 2016
$23.521 million in 2017
$37.762 million in 2018
while enjoying profit margins of 25.56%
Government protection and support
The Chinese government has made it difficult for
many US tech companies like Amazon, Microsoft,
and Google to compete in China giving an
advantage to Chinese companies like Alibaba to
dominate Chinese markets with hardly anydominate Chinese markets with hardly any
The government of China has used Alibaba’s Tmall
and Taobao to complete billions of dollars in
transactions between government agencies, which
has given them the advantage to capitalize on the
market where there are few competitors like Baidu.
Expansion of Alibaba’s physical
Expanding through supermarkets and retail chain
acquisition has become one of the company’s other
This will help grow Alibaba’s online and offline
presence, further growing the company’s revenue
and profit margin.
As part of its strategy,
Alibaba has spread its investments around the
world diversifying into different segments including :-
Core commerce, cloud computing, digital media and
entertainment and innovative initiatives among others.
These different segments have helped grow its
market share as well as revenue.
Strong brand name
Alibaba has expanded its presence through
investments in India, Australia, Europe and Israel
This has helped the company to grow and expand
its brand name, as well as its global market
As an e-commerce company primarily, Alibaba
derives its operational based efficiency largely
The company’s computing network and wealth of
data have given it an advantage in technology
innovations, helping it build a computational system
that is the fastest cloud-based platform.
The company’s AI-based platform can process
175,000 transactions a second at peak periods and
can handle 10 million orders and have all of them
The company has also invented other functions like:
AI Chatbot, Pailitao image search App among
others which have increased efficiency, customer
service, and reduced costs
King of counterfeits reputation
Alibaba has long been accused of counterfeit
goods sold through its online shopping platforms
Alibaba in 2016 landed on the list of notorious
markets where piracy and counterfeiting are
rampant, an inappropriate issue for the company at
a time when it was trying to expand globally hence
affecting its reputation.
Alibaba has been accused of defrauding
shareholders by concealing regulatory warnings
about counterfeits that the Chinese online retailer
had received before going public.
The company has been accused by shareholders for
concealing a meeting in July 2014 before its $25
billion initial public offering.
China’s state administration for industry and
commerce threatened to fine the company if it
didn’t suppress counterfeiting.
This poses a threat to the company’s revenue as it
is to either give up important sources of its
revenue or face fines huge fines.
Over dependent on core business
and Chinese market
A large part of Alibaba group’s revenue comes
from e-commerce business which is its core business.
Core commerce revenue was 84% of the brand’s
total revenue in 2019.total revenue in 2019.
Apart from that the main market of Alibaba group
is China and the company earns a very small part
of its revenue from the international markets which
is less than 10%.
The company depends mainly on the Chinese
market and its e-commerce business mainly for
revenues and profits.
Chinese regulatory curb on social media
a great opportunity for Alibaba.
As Beijing steps up its effort to curb content sharing,
rival Tencent’s social media business will face
strict control in China, which will affect the
company’s margins and limit its competitive
advantage against Alibaba giving Alibaba an
opportunity to grow and expand its market
Increasing internet penetration
China’s online population grew to 772 million by
the end of 2017 with an addition of 40.74 million
China’s internet availability rate reached 55.8% China’s internet availability rate reached 55.8%
exceeding the global average by 4.1 %.
The increasing internet penetration is an opportunity
for e-commerce companies like Alibaba as it could
tap more potential to grow the online industry.
Alibaba group can find new opportunities of
revenue growth and expanding its customer base
by expanding overseas at a faster pace.
There are a large number of European, Asian and
Middle eastern markets that present significantMiddle eastern markets that present significant
opportunities for both the e-commerce and cloud
business of Alibaba.
By investing in overseas market and gaining a
foothold in other Asian and European markets, the
company would also be able to reduce its
dependence on the Chinese market as well.
Unfair competition Complaints
Whereas ensuring free and fair competition online
is a regulatory priority as a way to cultivate a fair
market environment, Alibaba has been accused by
several top brands for unfair competition
The trial with disaffected companies could damage
Alibaba’s reputation at a time when it’s working on
making it's business global.
Stable profitability has increased the number of
players in the industry over last two years which
has put downward pressure on not only profitability
but also on overall sales.
The demand of the highly profitable products is
seasonal in nature and any unlikely event during the
peak season may impact the profitability of the
company in short to medium term.
Growing tensions in US-China relationships also
pose a threat to major Chinese businesses like
In the international market, this can translate into In the international market, this can translate into
significant trade barriers, scaling which can be
Apart from pressure upon revenue and profits, it
has also resulted in slowed growth for major
Chinese companies doing business overseas.
Names (in alphabetical order) Enrollment Numbers
Fenil Pandya IU 1981810033
Heet Makadia IU 1981810015Heet Makadia IU 1981810015
Hitarth Barot IU 1981810069
Janam Patel IU 1981810067
Shreyansh Singh IU 1981810053