Major food delivery competitors have been losing big money in fight for market share. Chinese consumers who live on cheap meals delivered to their doorsteps may see their happy days numbered because the steep discounts now offered by business operators may end soon as a result of market consolidation…Full Article: China Daily Sept 2016

Key Point

  • On 5 September 2016, Chinese media reported that Baidu was close to reaching a deal to sell Waimai (food delivery business) and Nuomi (e-commerce) to the Tencent-backed Meituan-Dianping. In general, China’s three primary online (e-commerce) food distribution players are Baidu, Tencent [see JD.com] and Alibaba Group [see Eleme].

ChinaAg Comments

  • In April 2016, Baidu Waimai became a distributor of China Quanjude (Group), a restaurant chain known for its Beijing roast duck.
  • In December 2015, Baidu Waimai announced plans to raise US$300 million to US$500 million in order to develop its food delivery platform.
  • In November 2015, according to Data Center of China Internet (DCCI), Baidu Waimai had a 32% market share, followed by Meituan Waimai at 31.2% and Eleme at 29.8%.
  • As of October 2015, Baidu Waimai had operations in 109 cities.
  • In July 2015, Baidu stated it would invest US$3.2 billion in its O2O (Online to Offline, or online to physical stores) e-commerce platform Nuomi over the next three years. Nuomi will offer a wide range of services including food delivery.
  • Founded in 2014 and headquartered in Beijing, Baidu Waimai (subsidiary of Baidu Inc., NASDAQ:BIDU) is an e-commerce platform that focuses on food delivery.
  • Founded in 2003 and headquartered in Shanghai, Dianping is a restaurant-review and group-buying services platform. It has been compared as a mixture of US-based commerce sites of Yelp (restaurant review) and Groupon (e-commerce merchant). Its primary competitor in China is the Beijing-based Meituan.com (founded in 2010). In May 2016, a Shanghai court ordered Baidu (search engine) to pay CNY 3 million (~US$456,900) in damages to Dianping over copying comments and other information to Baidu controlled sites.

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