Sigma Pharmaceuticals has launched an Amcal-branded e-commerce platform in China, hoping to capitalise on the strong demand for quality Australian products.
Australian pharmacy wholesaler and distributor, Sigma Pharmaceuticals, has today launched a Chinese e-commerce site. The Amcal-branded site will be the first of Sigma’s brands to launch in the lucrative Chinese market via a fully managed e-commerce platform.
The move will enable the pharmacy wholesaler to establish retail operations to tap the strong Chinese demand for high-quality and ethical Australian products such as vitamins, milk powder and infant formula. However, Sigma is looking to expand sales of other products, including skincare and beauty products, into the region. The Chinese Amcal site will stock around 80 percent of the range offered through the Australian site.
Founded in Melbourne in 1912, Sigma is one of Australia’s largest full line pharmacy wholesale and distribution businesses. It also has the largest pharmacy network in Australia, including brands like Amcal, Guardian, PharmaSave, Chemist King and Discount Drug Stores.
Sigma’s move into the Chinese market is unusual in that it has opted to launch a direct market presence via its own branded website rather than focus its initial entry on a major marketplace like the Alibaba-owned Tmall Global.
Unlike online retail in Australia, which for the most part is carried out over individual branded websites, marketplaces like Alibaba and JD.com dominate Chinese e-commerce. Other major Australian retailers that have approached the Chinese market, like Woolworths and Chemist Warehouse, have tended to launch through a marketplace storefront rather than an independent website.
To facilitate this move, it has partnered with Chinese e-commerce solution provider Azoya. Besides the branded e-commerce platform, Sigma will also sell its products through Azoya’s own cross-border shopping platform, Haituncun.com. Establishing an independent website will provide Sigma with a visibility that it might not be able to achieve over the larger marketplaces like Tmall or JD.com.
“Given the language and cultural barriers, we wouldn’t have been able to fulfil our Chinese expansion plans without a local partner,” said Mark Hooper, CEO of Sigma Pharmaceuticals.
Besides the e-commerce platform, Sigma’s local partner is also providing marketing operations, customer service and other operational services.
Compared to testing the market via a marketplace storefront, Sigma’s website also represents a more long-term investment in the Chinese market. This comes during a period of uncertainty for Chinese cross-border e-commerce. Various changes have been made to China’s cross-border e-commerce regulations over the past year, including the announcement of a new cross-border sales tax (and the subsequent postponement in rolling out the tax) and a revised “white list”, which allows for relaxed import and sales restrictions on certain listed products.
However, as a full-line pharmacy, Sigma will be less exposed to regulatory changes than niche retailers, due to its more expansive product range and the fact that it doesn’t rely on selling a single product range (e.g. vitamins or milk products) into the market.