Qicheng Venture Capital, an investment fund backed by Chinese e-commerce giant JD.com Inc. has made a strategic investment in brick-and-mortar fresh produce chain store operator Qiandama.
The move comes as JD.com, along with several other Chinese online shopping services, continues to expand its offline retail channels to dominate how consumers buy everything from televisions to eggplants.
It is unclear how much capital Qiandama raised in this latest round, which was reported by local media citing insiders. JD.com's goals, as the largest backer of Qicheng Venture Capital, are also undetermined.
JD.com could deploy its resources in fresh produce supply chain management, logistics capabilities and financial services to help Qiandama scale up and create a seamless online-and-offline shopping experience.
The move does appear to be part of JD.com's broader strategy to combine online and offline retail services as Chinese consumers demand convenient and economical shopping options both on their smartphones and in local community stores.
As early as 2015, JD.com invested RMB4.3 billion in fresh produce supermarket franchise Yonghui Superstores to cooperate in wholesale, logistics, financial services and big data. The company also deepened its partnership with U.S. retail giant Wal-Mart Stores, Inc. to better merge online and offline services.
JD.com has also accelerated the opening of its own offline retail facilities. In April, JD.com's supermarket division said it plans to open 5,000 maternity experience stores within three years to help mothers in smaller cities purchase safe maternity and baby products.
The company is also planning to open one million convenience stores to service rural residents' demand for fast-moving consumer goods. Last month, it opened JD Home, an offline consumer electronics store under a partnership with Wal-Mart, in Shenzhen, and has stated plans for additional openings. Ultimately, JD.com said it plans to operate one JD.com store for every seven community stores across China within five years.
Qiandama was founded in 2012 and currently operates over 260 community stores, selling over 500 types of vegetables, fruits, seafood, meat and cooked food. The company previously raised two rounds of financing, but no details were available regarding how much was raised or the identities of the investors.