Japan’s third-richest man is planning to bring his Internet retailing business to India and Australia. This is what Hiroshi Mikitani, a Harvard Business School graduate and CEO of Rakuten, has planned as he prepares to take on Amazon. He even has a shirt that reads “Beat Amazon”.
Rakuten is the world’s third largest Internet retailer, with Amazon and Apple taking up the first two spots. In Japan, however, Rakuten takes the lead, with Amazon, Apple, and Yahoo! trailing behind. It has made several acquisitions in the past three years, including purchases of stock in the social networking platform Pinterest and digital book seller Kobo. Rakuten later this year purchased Kobo in full for $315 million. Other acquisitions it has made are Play Holdings, Ltd., A U.K. music and game retailer, and Buy.com, a U.S. retailer. Its website, Rakuten Ichiba, also caters to overseas customers ordering Japanese items. The company also hopes to expand to Southeast Asia, Eastern Europe, and Latin America, but Mikitani indicates that they will adjust their strategy as the situation and the market warrant.
Things, however, are not all that good for the retailer. Some analysts have described Rakuten’s slow growth, with some even recommending selling Rakuten stocks. According to Bloomberg, Rakuten’s annual sales over five years only averaged at 13 percent, a stark contrast to Amazon‘s 35 percent. Back home in Japan, Rakuten has lost 7.9 percent in stocks this year, gaining a measly 0.7 percent this Thursday. Japan’s slowing economic growth is seen as one of the major reason for the retailer’s plans to expand abroad.
[ via BusinessWeek ]